Aspire’s Ovoot project gains traction as bond funding reaches US$11.2m

Bond funding starts as Ovoot construction moves on site

Aspire Mining Limited (ASX:AKM) has begun physically establishing the Ovoot Coking Coal Project in Mongolia, but the quarter also exposed the financing gap still separating construction progress from a completed mine. Aspire held US$2.067 million in cash at 30 September, equivalent to an estimated 1.8 quarters of funding on the Appendix 5B measure, while its Ovoot Bond programme had raised US$11.2 million by 28 October.

Seven bond tranches generated US$10.056 million during the quarter, with three further tranches adding US$1.140 million after quarter-end. The bonds carry fixed annual coupons of between 11% and 13%, payable quarterly, and mature between September 2027 and September 2029. The programme is registered for up to US$60 million, but any further issuance remains subject to investor demand and market conditions. An institutional investor is also conducting due diligence that could potentially complete the initial US$60 million issuance.

The fundraising is supporting a development plan that the company says requires additional capital beyond the current programme. Aspire is evaluating a further US$60 million, as well as possible coal offtake prepayments. The company’s largest shareholder and Gemnet LLC provide third-party guarantees for the existing bond obligations; no mortgage, pledge, charge or other security interest has been granted over the assets of the Mongolian project subsidiary.

Reserve and project economics remain unchanged

Aspire reconfirmed a 130.1 million tonne JORC (2012) Total Coal Reserve, comprising 76.8 million tonnes of Proved and 53.3 million tonnes of Probable reserves. The Marketable Coal Reserve stands at 97.9 million tonnes. The underlying resource and reserve models, pit limits and mineable inventory were not changed.

The updated project cost model forecasts about US$61.2 million in Phase 1 pre-production infrastructure capital from 2026 to first scheduled coal production, excluding roughly US$24.6 million of working capital and capital expenditure incurred to 31 December 2025. On the company’s assumptions, the project carries a post-tax NPV10 of US$1.483 billion and a post-tax real IRR of approximately 60%, based on a long-term coking coal price of US$230 per tonne delivered duty paid to Erlian, China. The reserve and lower-capital development plan had been detailed in the September reserve update, which retained the 130.1 million tonne reserve while reshaping the funding and construction approach.

Those figures are forecasts, not cash returns. The model assumes Khurgatai Khairkhan raises about US$126 million through Mongolian OTC bond issues and defers US$42 million of payments to CCTEG-IEC after commissioning. Aspire also discloses that approximately 12% of the production target comes from Inferred Coal Resources, where geological confidence is low and future conversion to higher-confidence resources is not assured.

CHPP reaches 85% design review

Construction activity has advanced at the coal handling and processing infrastructure. Gobi Infrastructure Partners, the principal Mongolian subcontractor to CCTEG-IEC, mobilised to site, established a contractor camp and commissioned a concrete batching plant. Geotechnical work beneath the Coal Processing Plant and thickener buildings was completed, foundation designs were finalised, and Aspire obtained a Construction Work Commencement Permit.

Image © Aspire Mining Limited. From “Quarterly Activities/Appendix 5B Cash Flow Report”, 30 Oct 2026.

Detailed CHPP design reached the 85% review stage, while the Erdenet Rail Terminal coal-handling infrastructure reached 50%. Statutory designs for trackwork were completed after the quarter and submitted for approval, with tender packages for construction still pending that approval. The progress builds on the US$69.9 million EPC contract previously executed with CCTEG-IEC for the CHPP and ERT infrastructure.

Cash burn leaves financing as the immediate test

Aspire spent US$9.022 million on property, plant and equipment during the quarter, including US$8.6 million in cumulative advance payments to CCTEG-IEC equal to 15% of the EPC lump-sum contract price. Operating cash outflow was US$774,000, while financing inflows of US$10.056 million largely offset the US$9.391 million investing outflow. The company also reported US$156,000 in payments to directors and their associates.

The company says it expects to continue operating and progressing the project through existing cash, further Ovoot Bond issues, possible offtake prepayments and vendor-financing arrangements. It also acknowledges that further funding is required and that these measures are not yet secured. Cabinet approval of the Murun-Uliastai highway PPP agreement remains pending, while design approvals, bond placements and construction progress will determine how quickly the current development momentum can be converted into a producing operation.