|5,000 kcal/kg GCV coal||,||0.8% sulphur||,||8% ash|
size 0-30mm price 72,500 mnt / tonne + 10% VAT (Sukhbaatar station free on rail)
size 30-70mm price 72,500 mnt / tonne + 10% VAT (Sukhbaatar station free on rail)
||||SGS assay report|||||Sukhbaatar station map|
Since 2010, the Company has invested over $60 million at Ulaan Ovoo. This includes road and bridge construction, mining vehicles, mining camp, pre-stripping, and other infrastructure and community improvement. The Ulaan Ovoo thermal coal mine is strategically located 17 km from the Russian border and 120 km from both Mongolian and Russian rail links. Wardrop Engineering (Tetra Tech) estimated 174 Mt of measured and 34 Mt of indicated coal resources in an NI 43-101 report in 2010. The coal is bituminous (5,040 kcal/kg), low ash (11.3%), low sulphur (0.40%), and suitable for export. The mine features a single massive coal seam that is 45-80 m thick with an average strip ratio of 1.8:1. The first 8 years of mining requires no coal washing.
Location and Ownership
Prophecy’s 100% owned Ulaan Ovoo coal mine was commissioned to production in December 2010 and since that time the Company has spent over $60 million on the project, including road and bridge building, mining fleet, mining camp, pre-stripping, and other infrastructure and community improvement.
The Ulaan Ovoo property sits approximately 430 km by paved highway from the capital city of Mongolia, Ulaanbataar. It is also strategically located just 17 km from the Russian border and 120 km from both Mongolian and Russian rail links. The project contains 209 million tonnes of measured and indicated coal resources (NI 43-101; 174 Mt of measured and 34 Mt of Indicated*). A prefeasibility study of the initial mining area found the coal to be a high-quality, high-volatility sub bituminous rank (ASTM) thermal coal that is economically mineable with a 1.8:1 strip ratio. The average coal assay for the mining area is gross calorific value 5,040 kcal/kg with low ash at 11.3% and very low sulfur of 0.40% (all on the as-received basis). Characteristics of the deposit, including a coal thickness of at least 53 meters, a low strip ratio and no coal washing required for the first 8 years of operations, make for a low cost mining operation.
*-Ulaan Ovoo resource estimate is from the NI 43-101 Behre Dolbear report prepared in 2007. Coal reserves estimate from the NI 43-101 report prepared by Wardrop Engineering in 2010.
To date, the exploration work on Ulaan Ovoo includes detailed mapping, over 110 drill holes, more than 1,200 coal and rock analyses, and rock mechanics tests and hydrological, rock mechanics,coal resource and advanced mining, engineering and scoping studies. The project area is underlain by two major coal seams—with total net coal thickness up to 70 m—and five minor seams. Detailed exploration drilling work was performed on the deposit during the late 1970’s by the Mongolian Ministry of Geology and Energy and again from 1993-1997 by Erdenet, a Mongolian-Russian joint venture mining and processing company. The results indicated a large coal deposit of over 78 million tonnes in the northern part of the deposit area. Exploration at the southern part of the deposit area was incomplete, but the resoure was speculated to be comparable in size to that of the north.
During 2006, Red Hill (predecessor to Prophecy),commissioned Behre Dolbear Inc. (USA) to supervise an 11-hole, 2,400 m diamond core drilling program at Ulaan Ovoo. Of these, six holes were drilled in the northern portion of the reserve to confirm previous results and five holes were drilled in the southern part of the area to increase the reliability of the model in this area. Over 362 core samples were taken, containing over 470 m of coal. The final results from the 2006 drilling program increased the resource estimate by an additional 130.8 million tonnes (168%), to 174.5 million tonnes in the Measured category, 34.3 million tonnes in the indicated category, and 35.9 million tonnes in the inferred category.
Environmental Approval Granted by Mongolian Government
Prophecy received approval of a Detailed Environmental Impact Statement (DEIA) on the Ulaan Ovoo project from the Mongolian Ministry of Nature and the Environment during 2008. Under Mongolia’s 2006 Minerals Law and 1995 Environmental Protection Law, approval of a DEIA is required before a project may be developed.
The DEIA was prepared by Ecos LLC, an independent Mongolian environmental consulting company, and considers social and labour issues, climate and environmental circumstances of the project area, potential environmental impacts of a full mining operation, as well as other important factors. The study concluded that there are no major impediments to mining at Ulaan Ovoo and provided recommendations on best practices for conservation of the environment and community. The DEIA also assessed the local public opinion of the project, finding that a large majority of the local residents and soum (township) government support the project because of its potential to bring new, high-paying employment opportunities and expansion of the local economy. During 2010, Prophecy received an Annual Environmental Protection Plan by the Mongolian Ministry of Environmental Protection.
In 2010, Prophecy received an Annual Environmental Protection Plan by the Mongolian Ministry of Environmental Protection.
Mineral resources that are not mineral reserves do not have demonstrated economic viability. Neither the Toronto Stock Exchange nor its Regulation Services Provider (as that term is defined in the policies of the Toronto Stock Exchange) accepts responsibility for the adequacy or accuracy of this website..
Qualified Person under NI 43-101
Christopher M. Kravits P.Geo., a consultant of the Company is the qualified person responsible for the technical information on this website.
- Single thick coal seam
- Outcrop is 50 m wide (max 200m)
- Over 200 Mt M&I resource*
- 20+ years mine life
- 5,000 kcal/kg
- Low ash 10% & sulfur 1%
* – Wardrop Engineering (Tetra Tech) estimated 174 Mt of measured and 34 Mt of indicated coal resources in 2010
NI 43-101 Resources
|Total M&I||208.8 Million|
Ulaan Ovoo resource estimate is from the NI 43-101 Behre Dolbear report prepared in 2007. Coal reserves estimate from the NI 43-101 report prepared by Wardrop Engineering in 2010.
- Dec 2010, 43-101 Prefeasibility Study Update (File size: 5.0mb)
- May 2009, 43-101 Prefeasibility Study (File size: 9.0mb)
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Mar 11, 2014
Cautionary Note Regarding Forward-Looking Statements
Certain statements contained on this page, including statements which may contain words such as “expects”, “anticipates”, “intends”, “plans”, “believes”, “estimates”, or similar expressions, and statements related to matters which are not historical facts, are forward-looking information within the meaning of applicable securities laws. Such forward-looking statements, which reflect management’s expectations regarding Prophecy’s future growth, results of operations, performance, business prospects and opportunities, are based on certain factors and assumptions and involve known and unknown risks and uncertainties which may cause the actual results, performance, or achievements to be materially different from future results, performance, or achievements expressed or implied by such forward-looking statements. These estimates and assumptions are inherently subject to significant business, economic, competitive and other uncertainties and contingencies, many of which, with respect to future events, are subject to change and could cause actual results to differ materially from those expressed or implied in any forward-looking statements made by Prophecy.
In making forward-looking statements as may be included on this page, Prophecy has made several assumptions that it believes are appropriate, including, but not limited to assumptions that:; there being no significant disruptions affecting operations, such as due to labour disruptions; currency exchange rates being approximately consistent with current levels; certain price assumptions for coal, prices for and availability of fuel, parts and equipment and other key supplies remain consistent with current levels; production forecasts meeting expectations; the accuracy of Prophecy’s current mineral resource estimates; labour and materials costs increasing on a basis consistent with Prophecy’s current expectations; and that any additional required financing will be available on reasonable terms. Prophecy cannot assure you that any of these assumptions will prove to be correct.
Numerous factors could cause Prophecy’s actual results to differ materially from those expressed or implied in the forward looking statements, including the following risks and uncertainties, which are discussed in greater detail under the heading “Risk Factors” in Prophecy’s most recent Management Discussion and Analysis and Annual Information Form as filed on SEDAR and posted on Prophecy’s website: Prophecy’s history of net losses and lack of foreseeable cash flow; exploration, development and production risks, including risks related to the development of Prophecy’s Ulaan Ovoo coal property; Prophecy not having a history of profitable mineral production; the uncertainty of mineral resource and mineral reserve estimates; the capital and operating costs required to bring Prophecy’s projects into production and the resulting economic returns from its projects; foreign operations and political conditions, including the legal and political risks of operating in Mongolia, which is a developing jurisdiction; title to Prophecy’s mineral properties; environmental risks; the competitive nature of the mining business; lack of infrastructure; Prophecy’s reliance on key personnel; uninsured risks; commodity price fluctuations; reliance on contractors; Prophecy’s minority interest in Prophecy Platinum Ltd.; Prophecy’s need for substantial additional funding and the risk of not securing such funding on reasonable terms or at all; foreign exchange risks; anti-corruption legislation; recent global financial conditions; the payment of dividends; and conflicts of interest.
These factors should be considered carefully, and readers should not place undue reliance on the Prophecy’s forward-looking statements. Prophecy believes that the expectations reflected in the forward-looking statements contained on this page and the documents incorporated by reference herein are reasonable, but no assurance can be given that these expectations will prove to be correct. In addition, although Prophecy has attempted to identify important factors that could cause actual actions, events or results to differ materially from those described in forward looking statements, there may be other factors that cause actions, events or results not to be as anticipated, estimated or intended. Prophecy undertakes no obligation to release publicly any future revisions to forward-looking statements to reflect events or circumstances after the date when information on this page is published or to reflect the occurrence of unanticipated events, except as expressly required by law.