Mongolia Energy (00276) issued an announcement. On March 6, 2024, MoeNC, an indirect wholly-owned subsidiary of the company...
Zhitong Finance App News, Mongolia Energy (00276) announced that on March 6, 2024, MoEnco, an indirect wholly-owned subsidiary of the company, signed a general engineering contract with Tangshan Shenzhou Machinery Group Co., Ltd. (the contractor). The contractor will be responsible for the construction and installation of the new dry processing plant at the Hushuotu coal mine. The total contract amount is RMB 99.85 million. According to the competition restriction agreement, the contractor also agreed not to invest, sell or operate within Kobdo Province, Mongolia for 8 years from the date of signing the general contract contract Any coal washing and processing business; and/or carrying out any design, construction, equipment supply and installation or general contracting project for any other coal mining, washing and processing enterprise in Kobdo Province, Mongolia, in exchange for compensation of RMB 4.9 million (approximately 5% of the cost of the construction project), but only after approval by shareholders at the special shareholders' meeting.
According to the announcement, the group currently operates a dry coal processing plant located in its own mine. The plant was officially put into operation at the end of 2014. The existing dry coal processing plant performs initial processing of crude coal to remove unnecessary gravel and other materials to improve the quality of the coking coal exported by the company and reduce the group's transportation costs. Existing dry coal treatment plants wash up to 2 million tons of gross coal each year.
Since commercial coal production began in 2015, coal production and washing volume have increased exponentially. In order to cope with increased production, increased competitiveness and mine development, the company's management plans to build a new dry coal treatment plant with an annual washing capacity of 5 million tons of gross coal to replace the existing facilities at the mine. The Shinkan Selection Plant is expected to commence operations in the second half of 2025.
Furthermore, according to the company's mining plan at the Hushuotu coal mine, MoEnco will carry out mining work in the current office and administrative area from 2025 to 2026 or around. Therefore, MoEnco must relocate its existing office and supporting facilities to a new area within the mine by the end of 2025, and build (including) a new office administration building, an industrial office building and a range of supporting facilities, including a new dry processing coal processing plant in the new area. Failure to relocate in a timely manner will affect and limit the company's coal production plans.