The Mineral Resource Authority of Mongolia granted the South Gobi mining licence for an initial term of 30 years with an option for two 20-year extensions.
Guildford said the mining licence for the South Gobi project provided “the necessary building blocks for the potential start-up of an open cut mining operation in mid-2012.”
The South Gobi project area now consists of one mining licence, one mineral development licence and three exploration licences.
These licences are situated approximately 1000km southwest of the Mongolian capital of Ulaanbaatar and 60km from the Chinese border station of Ceke, where coal from Mongolia is transported through to China.
The project is also located approximately 50km east of Nariin Sukhait, the location of SouthGobi Resources’ Ovoot Tolgoi mine and the MAK mine, which currently produce and export coking and thermal coal to customers in China.
Meanwhile, independent geologists undertook a further review of the South Gobi project, resulting in the upgrade of the project’s JORC-compliant resource to 70.4 million tonnes of coking coal.
Scoping studies for the start-up operation at South Gobi will be completed early next month, considering a 2 million tonne per annum operation and a 4Mtpa operation.