The infrastructure investment follows the opening last May of eight new border gates for coal transportation which miner SouthGobi Resources said would “significantly increase” the capacity of coal traffic between Mongolia and China.

The paved highway will extend from SouthGobi’s flagship Ovoot Tolgoi complex to the Shivee Khuren border crossing.

Mongolia’s state property committee awarded the tender to construct the highway to SouthGobi and consortium partner NTB LLC with a concession to conclude construction in 16 years.

SouthGobi Resources president and chief executive Alexander Molyneux commented on the project following a ribbon-cutting ceremony earlier this week.

“The new paved coal highway will significantly increase the safety of coal transportation to the border, reduce dust and improve efficiency and capacity of coal transportation,” he said.

SouthGobi Resources is focused on exploration and development of its Permian-age metallurgical and thermal coal deposits in Mongolia’s South Gobi region.

Ovoot Tolgoi holds in-place coal resources of 199Mt (measured), 103Mt (indicated) and 86Mt (inferred).