Aspire Mining Cuts Ovoot Upfront Capital to US$61M With NPV Holding at US$1.48B
Key Takeaways
- Aspire's Ovoot Coal Reserve is reconfirmed at 130.1 Mt, with 97.9 Mt marketable, even as the development plan changes.
- The updated economics deliver a post-tax NPV₁₀ of US$1,483.3 million and a roughly 60% post-tax real IRR, down from the previous US$1.58 billion NPV₁₀ now that financing costs are included.
- Phase 1 pre-production capex is forecast at about US$61.2 million, driven by rented mining fleets, contracted haulage and deferred site infrastructure.
- The US$69.9 million CCTEG-IEC EPC Contract is executed, with Sinosure supporting 60% of the price and coal production targeted for Q4 2027.
- The funding plan relies on about US$126.0 million of Mongolian OTC bonds at 12% that are assumptions and not secured, and about 12% of the production target comes from Inferred Resources.
Ovoot reserve update delivers US$1.48 billion post-tax NPV₁₀ and 60% IRR
Aspire Mining (ASX: AKM) says Glogex Consulting LLC (Glogex) has completed an updated Coal Reserve estimate for the Ovoot Coking Coal Project under the JORC Code (2012), effective 31 March 2026. The updated economic evaluation returns a post-tax NPV₁₀ of US$1,483.3 million (about US$1.48 billion) and a post-tax real IRR of approximately 60%.
NPV₁₀ is the present value of the project’s forecast cash flows, discounted at 10%. IRR is the annual return the project is forecast to generate.
The Total Coal Reserve of 130.1 Mt and Marketable Coal Reserve of 97.9 Mt are reconfirmed, unchanged. This is a revised version of the 11 September 2026 release, dated 7 October 2026. It updates the paragraphs under “JORC Table 1” and moves JORC Table 1 Sections 1-3 into Appendix 1.
The updated cost model forecasts Phase 1 pre-production capital expenditure of approximately US$61.2 million from 2026 to first scheduled coal production. That excludes approximately US$24.6 million of estimated working capital and capital expenditure incurred to 31 December 2025.
Project snapshot
- Aspire holds a 100% interest in the Ovoot Coking Coal Project
- 219.4 Mt JORC Coal Resource
- 130.1 Mt JORC Coal Reserve
- 97.9 Mt Marketable Coal Reserve
What this tells you: the reserve is intact, while less capital is required before first coal.
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Reserve and resource base holds firm
Reserves reconfirmed
The table below shows the Coal Reserves as at 31 March 2026, on the 2.9% as received ROM moisture basis, with Marketable Coal Reserves based on a washed product at 9.0% ash air dried and 10.0% total moisture.
| Category | ROM Mt | Marketable Mt |
|---|---|---|
| Proved | 76.8 | 60.0 |
| Probable | 53.3 | 37.9 |
| Total | 130.1 | 97.9 |
The same SRK-prepared Coal Resource and Coal Reserve models, pit limits and classification have been retained. Glogex concluded that the changes to the project development schedule, capital deployment strategy and Project Cost Model do not materially alter the mineable inventory or Coal Reserve classification.
The 219.4 Mt Coal Resource comprises 99.5 Mt Measured, 100.9 Mt Indicated and 19.0 Mt Inferred.
What does a Coal Reserve mean?
A Coal Resource is coal in the ground with reasonable prospects of eventual economic extraction. A Coal Reserve is the portion of that resource demonstrated to be economically mineable once mining, processing and cost factors are considered. Proved Reserves come from Measured Resources, the highest confidence category, while Probable Reserves come from Indicated Resources.
An unchanged Reserve alongside lower upfront capital matters because the amount of coal supporting the project has not shrunk, while less money needs to be committed before production starts.
Lower upfront capital through a staged development strategy
Glogex was engaged principally to review changes to the development strategy and update the Project Cost Model. The updated model incorporates a lower initial capital deployment strategy, including:
- An executed EPC Contract with CCTEG-IEC for the CHPP and ERT coal handling infrastructure, at an overall contract price of approximately US$69.9 million.
- Rental of the initial mining fleet for the first 3 years of mining activity.
- Contracted provision and maintenance of the road haulage fleet for the first 5 years of transportation operations.
- Deferral of non-critical Ovoot site infrastructure.
- Vendor construction and lease-back assumptions for certain supporting infrastructure.
The CHPP is the coal handling and preparation plant, and the ERT is the Erdenet Rail Terminal. Here is how the updated approach compares with the previous estimate.
| Item | Previous | Updated |
|---|---|---|
| Initial mining fleet | Purchased owner-operated fleet | Rented and vendor-maintained for the first 3 years |
| Initial road haulage fleet | Purchased owner-operated fleet | Contracted supply and maintenance for the first 5 years |
| CHPP and ERT capital basis | Engineering estimates | Executed EPC Contract pricing and payment schedule |
| Post-tax NPV₁₀ | US$1.58 billion | US$1.48 billion |
Post-tax NPV₁₀ moved from US$1.58 billion to US$1.48 billion. The new model now includes financing costs, and the previous study reported forecast capital expenditure to first revenue of US$214.8 million.
The source states the figures are not directly comparable on a like-for-like basis, because expenditure incurred since the previous estimate is excluded from the new forward capital forecast and the timing, ownership and financing of a number of assets have changed. The announcement says the updated strategy materially reduces the amount of project capital required to be deployed before scheduled commencement of coal production.
Financing assumptions and project pathway
The financing inputs are modelling assumptions only. The announcement states they do not represent a guarantee that financing will be raised in full, on the assumed timetable or on the assumed terms.
The model assumes Khurgatai Khairkhan LLC (KK), Aspire’s wholly owned Mongolian subsidiary, progressively raises Mongolian OTC bonds with these terms:
- About US$126.0 million raised across multiple tranches.
- An assumed term of 24 months for each tranche.
- A coupon of 12% p.a., payable quarterly.
- Broker success fees of about 3%.
The assumptions also incorporate approximately US$42.0 million of deferred payments to CCTEG-IEC under the EPC Contract, supported by Sinosure in relation to 60% of the EPC Contract Price.
The production timeline assumed in the model is:
- Coal production commencing in Q4 2027.
- CHPP commissioning targeted for October 2027 and the ERT for November 2027.
- Ramp-up from about 1.5 Mtpa to 2.5 Mtpa and then 5.0 Mtpa ROM coal.
- An operating mine life of approximately 31 years.
The base case uses a long-term coking coal price of US$230/t DDP Erlian in real terms and a 10% real post-tax discount rate. Outstanding items include award of the PPP Agreement for the Murun-Uliastai Highway, approval of the statutory DEIA for ERT infrastructure, and approval of the statutory Feasibility Study and DEIA for Transportation Hub infrastructure.
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Why it matters for Aspire investors
Three points stand out from the update:
- The Coal Reserve is unchanged at 130.1 Mt.
- Less project capital is required before scheduled first coal production.
- The project has advanced from study into implementation, including the US$69.9 million EPC Contract.
One caveat applies. About 12% of the production target comes from Inferred Resources, with 52% from Proved and 36% from Probable Reserves. The announcement states there is a low level of geological confidence associated with Inferred Mineral Resources and no certainty that further exploration will result in Indicated Mineral Resources or that the production target itself will be realised.
Sensitivity analysis, varying inputs by up to ±20%, indicates NPV is most sensitive to revenue, followed by operating costs and capital costs. In plain terms, the coal price matters most to the outcome.
Glogex Consulting LLC conclusion
Glogex concluded that the changes to the Project development schedule, capital deployment strategy and Project Cost Model do not materially alter the mineable inventory or Coal Reserve classification.
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