SouthGobi Restarts Output at Mongolia Coal Mine on OutlookElisabeth Behrmann
SouthGobi Resources Ltd., a Mongolian coal mining company controlled by Rio Tinto Group, will restart production at its Ovoot Tolgoi mine as the outlook for prices improves.
The company plans to produce 3.2 million metric tons of semi-soft coking coal over the remainder of 2013, Vancouver-based SouthGobi said yesterday in a statement.
Production at the mine has been halted since the end of June 2012 after prices and customer purchases declined. SouthGobi’s relations with Mongolia became strained last year after Aluminum Corp. of China Ltd. launched an ultimately unsuccessful bid for a stake in the coal producer.
“While a certain amount of volatility remains in the coal markets, signs of improvement justify this restart of operations,” SouthGobi said.
SouthGobi, controlled by Rio’s 51 percent-owned unit Turquoise Hill Resources Ltd., fell 0.5 percent to C$2.09 at the close of trading in Toronto yesterday. The stock has declined 67 percent in the past year.