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15. June 2011

Reuter update on iron ore producers and projects in Africa

Reuters reported that Africa has the potential to become a major iron ore exporter after 2020 if countries manage to solve their infrastructure and political challenges.

Below is a list of major projects.

Cameroon

1. Australian Sundance Resources is in talks with potential partners to develop its Mbalam project. First output is foreseen by the end of 2014 ramping up to 35 million tonnes.
2. Afferro Mining is looking at developing its estimated 1 billion tonnes iron ore resources at Nkout.

Congo Republic

1. Zanaga Iron Ore seeks to develop a project seen producing 45 million tonnes of concentrate at full capacity. Xstrata owns a majority stake in Zanaga operating unit.
2. Sundance plans to spend USD 600 million to develop its Nabemba mine expected to produce 21 million tonnes from 2014.
3. Equatorial Resources is developing two iron ore projects which its says are have significant scale potential.

Gabon

1. The Belinga project is a focus of Gabon policy to diversify away from oil. Awarded to China CMEC in 2006, the project stalled. Gabon said last year it would review the deal.

Guinea

1. A JV of Rio Tinto and Chinalco listed unit Chalco plans to develop the Simandou deposit with first shipments seen by mid-2015. The JV targets initial production of 70 million tonnes per year, with estimates for potential future output reaching up to 170 million tonnes.
2. Brazil's Vale spent USD 2.5 billion on a stake in BSG Resources to be able to build the Simandou-Zogota mine. The mine will start producing at a rate of 2 million tonnes per year in 2012, ramping up to 50 million by 2020.

Ivory Coast

1. India TATA Steel signed a deal in 2007 with Ivorian state miner SODEMI to develop deposits at Mount Nimba.

Liberia
1. Liberia signed a deal with BHP Billiton to allow it to explore and develop a potential USD 3 billion project.
2. ArcelorMittal restarted work on its USD 1.5 billion Mount Nimba project which was stalled last year.
3. Afferro is in partnership with Russia's largest steelmaker Severstal to develop the Putu iron ore resources recently estimated at 2.4 billion tonnes.

Mali

Indian-owned firm Sahara Mining plans to produce 50,000 tonnes per month at its Tienfala project.

Mauritana

1. State-owned miner SNIM produced 10.2 million tonnes in 2009. SNIM is developing the Guelb II project which it expects to add 4 million tonnes to its annual output.
2. Xstrata bought 76% in junior miner Sphere Minerals which has interests in three projects in Mauritania. Sphere holds 50% of the Guelb el Aouj project. An early blueprint calls for a mine capable of producing around 7 million tonnes of ore annually, though the partners are studying ways to increase that to as much as 30 million tonnes.

Senegal

ArcelorMittal restarted work last year on its USD 2.2 billion Faleme project which was suspended in 2009.

Sierra Leone
1. African Minerals plans to start production in the fourth quarter from its Tonkolili project. Phase I is expected to produce 12 million tonnes per year. The next two phases are expected to boost output by 23 million tonnes a year and 45 million per annum respectively.
2. London Mining is developing the Marampa project, with initial production expected to start later this year at a rate of 3.6 million tonnes. A Phase 2 expansion will produce up to 16 million tonnes of concentrate from the remainder of the Marampa ore body over 25 years.
3. Sable Mining bought an 80% stake in Red Rock Mining, a Sierra Leone firm which holds a 50 year lease over the Bagla Hills iron ore deposit.

South Africa

1. Kumba Iron Ore a unit of Anglo American produced 43 million tonnes of ore last year and plans to up output to 53 million by 2013 and 70 million by 2019.
2. ArcelorMittal South Africa is in talks to buy a mine which could supply between 2 and 3 million tonnes.
3. Junior explorer Motjoli Resources seeks partners to develop the Cascades project in South Africa Mpumalanga province. Initial output is set at 6 million tonnes a year ramping up to 20 million at full production.
4. Midwinter Resources is working on its Northern Lights project, seen to be able to produce high quality concentrates.

Zimbabwe

India Essar has signed a deal with Mozambique to build a 20 million tonne iron ore terminal at Beira port with feedstock coming from Zimbabwe Ripple Creek mine. Ripple Creek is owned by Essar and Zimbabwe government. Essar also intends to develop the Mwanesi iron ore project which it said had a multi billion tonne resource potential.


Source: Reuters.com

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