The consortium includes the state-run Korea Rail Network Authority and top  builders such as Daewoo Engineering & Construction, Hyundai Engineering &  Construction and Lotte Engineering & Construction. Lotte Engineering said the deal between the consortium and Mongolian  Railway was signed in Seoul on Thursday, adding that work is planned to begin  next year.

The consortium has offered to build a 1,040 kilometre (650 miles) railway linking Mongolia's Tavan Tolgoi mine in the south Gobi desert with the eastern city of Choibalsan early this month.

Tavan Tolgoi is the biggest untapped coal mine in the world, with about 6.4  billion tons of reserves. The five-year project is part of a Mongolian government plan to build 5,500  kilometres of cross-country rail by 2015 to transport mineral resources from  its mines.