Prophecy Power will be led by a board including Chris Kwan, Bailikhuu Dambachultem, and
coal arm chairman and chief executive officer John Lee. VP Sharma has been selected as an advisor to the unit.
The entity’s environmental impact assessment for the power facility was approved by the Ministry of Nature and Tourism in November 2010. A year later, the Ministry of Natural Resources and Energy granted the construction license, the first of its kind in the country’s history.
The 600 megawatt complex, made up of four 150MW units, will be erected adjacent to Prophecy Coal’s Chandgana coal deposit in central Mongolia, 60 kilometers from Undurkhann.
The power project will come together in two phases beginning next year, the first to include two 150MW units and transmission lines built next year. That portion should be completed by 2016.
The second phase of construction will involve building two more 150 megawatt units in 2014. That phase should finish in 2017.
Officials said that, since obtaining the license late last year, it had been in ongoing discussions with the Mongolian government to secure power purchase agreements that could, in turn, ensure the long-term energy supply across the country.
Prophecy also has been in talks with Mongolian companies in hopes of inking bilateral power purchase contracts.
The company’s own proposed mining projects and industrial development complex in Mongolia will require about 200 MW of power by 2016, not including the Oyu Tolgoi project.
Additionally, a coal supply agreement has been implemented with company subsidiary Chandgana giving Prophecy Power a supply of 3 million tonnes of coal annually for 25 years.
The complex controls more than 1.4 billion tonnes of measured and indicated thermal coal, including a starter pit with 140 million tonnes of measured resource and a strip ratio of 0.5 to 1.
When Prophecy closes its acquisition of the Tethys claims first announced in June, the company will have an historic resource estimate of 2.3 billion tonnes. Chandgana will control one of the largest thermal coal basins in the world – with enough coal supply for a power plant of 4200MW or bigger.
