ID :
112927
Mon, 03/22/2010 - 16:43
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https://www.oananews.org//node/112927
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PREPARATIONS UNDERWAY FOR MONGOLIAN COAL PRODUCTION
Ulaanbaatar, /MONTSAME/ Red Hill Energy Inc. and Prophecy Resource Corp. has provided an update on recent activities underway to expedite production from Red Hill's 100% owned Ulaan Ovoo thermal coal project in northern Mongolia.
The preparations are being conducted by Red Hill with the full support of Prophecy, Red Hill's proposed merger partner. Red Hill Energy has engaged Wardrop Engineering Inc., a leading international mining engineering company, to conduct a Preliminary Economic Assessment ("PEA") on the 208 million tonne Ulaan Ovoo coal project (174.5 Measured, 35.9 Indicated and 34.3 Inferred). The new study will incorporate project economics based on current substantial increases in international coal prices since the project's Pre-feasibility Study was completed over 10 months ago. The PEA will also emphasize an immediate production scenario that will utilize truck transport on existing roads to the central railroad thereby deferring the construction of a 120km spur line. Wardrop personnel are currently in Mongolia undertaking the PEA.
Red Hill Energy is in discussions with international mining contractors, including those with extensive experience operating inside Mongolia. Red Hill and Prophecy intend to finalize mine plans and a turn-key contract to bring the Project into production this year.
Red Hill has also entered into a royalty purchase agreement with Dunview Services Limited, a private British Virgin Islands company, whereby Red Hill will acquire a 2% net smelter returns royalty held by Dunview over the mining licenses forming part of the Ulaan Ovoo project for the payment of US$130,000 in cash and 2,000,000 Class A Shares. The completion of the royalty purchase is conditional upon the completion of the merger with Prophecy.
Arnold Armstrong, Chairman and CEO of Red Hill, stated that: "We intend to transform Red Hill from a junior company to a producer in 2010, and together with Prophecy we will have a strong pipeline of resource projects from which to build a company with a diversified revenue generating base."
S.Batbayar
The preparations are being conducted by Red Hill with the full support of Prophecy, Red Hill's proposed merger partner. Red Hill Energy has engaged Wardrop Engineering Inc., a leading international mining engineering company, to conduct a Preliminary Economic Assessment ("PEA") on the 208 million tonne Ulaan Ovoo coal project (174.5 Measured, 35.9 Indicated and 34.3 Inferred). The new study will incorporate project economics based on current substantial increases in international coal prices since the project's Pre-feasibility Study was completed over 10 months ago. The PEA will also emphasize an immediate production scenario that will utilize truck transport on existing roads to the central railroad thereby deferring the construction of a 120km spur line. Wardrop personnel are currently in Mongolia undertaking the PEA.
Red Hill Energy is in discussions with international mining contractors, including those with extensive experience operating inside Mongolia. Red Hill and Prophecy intend to finalize mine plans and a turn-key contract to bring the Project into production this year.
Red Hill has also entered into a royalty purchase agreement with Dunview Services Limited, a private British Virgin Islands company, whereby Red Hill will acquire a 2% net smelter returns royalty held by Dunview over the mining licenses forming part of the Ulaan Ovoo project for the payment of US$130,000 in cash and 2,000,000 Class A Shares. The completion of the royalty purchase is conditional upon the completion of the merger with Prophecy.
Arnold Armstrong, Chairman and CEO of Red Hill, stated that: "We intend to transform Red Hill from a junior company to a producer in 2010, and together with Prophecy we will have a strong pipeline of resource projects from which to build a company with a diversified revenue generating base."
S.Batbayar
