17 Jan 2012 12:37
17 January 2012
Nova Resources Limited
("Nova" or the "Company")
Coal Transportation Contract
The Board is pleased to announce that ZHCH Mining LLC ("ZHCH") has entered into a coal transportation contract with Transgobi LLC (which office is at 15, Central Tower, Sukhbaatar Square-2, Sukhbaatar District, 8th khoroo, Ulaanbaatar 14200, Mongolia) to transport coal from its Ukhaa Khudag coal mine, located at Tsogttsetsii soum, Umnugobi aimag, Mongolia to Tsagaan Khad, Mongolia (the "Contract").
ZHCH and Transgobi are now finalising the date on which operations pursuant to the Contract shall commence and Nova will issue an RNS as and when appropriate. Upon commencement and under the terms of the Contract, Nova estimates that the revenue per annum accruing to ZHCH from the Contract could exceed US$20 million. The Contract shall continue until either party terminates the Contract by giving 30 days prior notice.
The Contract was procured through the efforts of two Mongolian citizens who, pursuant to the announcement dated 6 December 2011, hold 30% of the entire issued share capital of Nova Mongolia by way of a joint venture agreement (the "Mongolian Shareholders"), and who have agreed to continue marketing for and executing transportation contracts. Pursuant to the joint venture agreement, Nova has agreed with the Mongolian Shareholders that it shall contribute to Nova Mongolia by raising funds that are necessary for Nova Mongolia, from time to time, to expand and execute its business (whether through ZHCH or otherwise). Furthermore, Nova has agreed that if any monies are raised by Nova Mongolia from Nova, the first US$16 million raised by Nova Mongolia shall not dilute the Mongolian Shareholders shareholding. Therefore, if the effect of the funds raised by Nova Mongolia are dilutive to the Mongolian Shareholders, additional Nova Mongolia shares shall be issued to the Mongolian Shareholders to maintain their percentage shareholding until US$16 million is raised.
For enquiries: | |
Nova Resources Limited | Tel: +65 6236 2985 |
Chan Fook Meng | |
Chief Executive Officer | |
Daniel Stewart & Co plc | Tel: +44 (0) 20 7776 6550 |
David Hart and James Felix (Nomad) | |
Martin Lampshire (Broker) | |
Further Information:
ZHCH is 100% owned by Salins Limited. Salins Limited is 100% owned by Nova Mongolia Pte Ltd ("Nova Mongolia"). Nova Mongolia is 70% owned by Nova.
Transgobi LLC is 100% owned by Energy Resources LLC ("ER"). ER is a coking coal producer and exporter in Mongolia; which owns and operates the Ukhaa Khudag high-quality coking coal deposit located within the Tavan Tolgoi coal formation in the South Gobi province of Mongolia. ER is considered as one of the largest coking coal producers in Mongolia. More information on ER and Transgobi may be found at http://www.energyresources.mn/ and http://www.energyresources.mn/about/show/id/8.