Ann: High Quality Coking Coal Properties Confirme, page-60

re: Ann: High Quality Coking Coal Properties ... SOUTHGOBI COMMENCES CONSTRUCTION OF COAL-HANDLING FACILITY

The coal-handling facility (CHF) will allow SouthGobi to add value to its coal by removing ash or waste rock and enable the blending of coal from different seams to create higher-value products.

Once commissioned (2011), it is intended that the CHF will operate on one 12-hour shift per day, six days per week. Annual capacity will be up to six million tonnes of coal on a one-shift-per-day basis, and operating hours can be extended as mining capacity increases.]
Three coal products are presently being mined or are expected to be produced at Ovoot Tolgoi and Soumber; a hard coking (or metallurgical) coal (Soumber), a direct shipping semi-soft coking coal (#5 seam - Ovoot Tolgoi), medium ash coal (screened) and a higher ash/sulphur coal (screened). Dry air separation and washing (8,9,10 seam coal) will upgrade the coal to semi-soft coking coal.

To further enhance product value, SouthGobi commenced construction of a basic coal-handling facility including dry-air separation. The coal-handling facility will remove ash (waste rock) and enable the blending of coals from different seams to create higher-value products.Initially two dry-air separation modules will be included in the facility with combined capacity to process six million tonnes a year.

Capital expenditure for the coal handling facility is US$45-million and completion is scheduled for THE END OF 2011.
Given the potential to turn the higher-ash Sunset pit No. 8/9/10 seams coals into semi-soft coking coals at a relatively high yield, it is likely a wet-washing facility will be built at Ovoot Tolgoi in addition to the dry-air separation plant.

http://www.southgobi.com/s/OvootTolgoi.asp

Won't be a problem for ME to clean up our coal i'd imagine.

"The Company's Managing Director, Mr Mark Earley commented that the coal quality results show the potential we have in Ovorhangay to, at a minimum, produce a soft coking coal.
The low inherent ash we have seen in the quality analysis lends well to a very low ash coal product through washing, which we expect would be well received in metallurgical coal markets and would be attractive to Chinese buyers, possibly even as a raw product.
These quality results along with the proximity of licences to the Chinese border and access to existing infrastructure make the economics of these assets very favourable."

Cheers

Sheeza