[miningmx.com] — KUMBA Iron Ore has clinched its first transaction in
West Africa since the iron ore producer made known its renewed interest in the region
in 2011, announcing a $10.5m Liberia-based greenfields exploration tie-up with Jonah
Capital.
Jonah Capital said on Wednesay that it would be a joint partner with Kumba in two
exploration ventures, at Gbarnga and Kalasi in Liberia. The $10.5m would be spent
over three years before the projects are reassessed.
Having previously secured ownership of the concessions, Jonah Capital holds another
four iron ore prospects in Liberia and has been operational in the country for six
years.
Liberia, together with Guinea and Sierra Leone in West Africa, are emerging as a
sought-after iron ore region. Around 17 million tonnes (Mt) of production capacity is
expected to come on stream by the end of 2013, from below the present level of 2Mt.
“These are our only assets in West Africa at the moment and the first to form part of
our expansion strategy to West and Central Africa,’ said a Kumba spokesperson.
Jonah Capital CEO John Barton-Bridges told Miningmx that the group would
act as managing partner during the exploration phase. “Our strength is in the early
stage,’ he said. “In future our roles will probably change.’
Former Kumba CEO Chris Griffith has on numerous occassions in the last year said
that the company was again looking to expand its footprint in West Africa. The
company’s first venture in the region ended in a dispute with Senegal’s state-owner
miner, Miferso, when the $2.2bn Faleme project in that country was awarded to
ArcelorMittal in 2007. Kumba and Miferso reached a settlement in 2010.
The company also discontinued the Kamambolo exploration project in Guinea in 2008
due to unsatisfactory exploration results.
“We have looked at iron ore in West Africa. Now we’ve decided to look again,’ Cynthia
Carroll, CEO of Kumba parent Anglo American, said in February. “It’s not a given that
there will be iron ore projects in West Africa. They will be a long time coming.’
A number of UK and Australian-listed companies are digging for iron ore in Liberia,
Guinea (Rio Tinto), Sierra Leone (London Mining) a well as the Republic of Congo – a
country in which Exxaro Resources invested earlier this year with the takeover of
African Iron.
An estimated 5,000km of rail and 11 new or expanded port projects also need to be
completed in West Africa in order to make the development of a new iron ore node
feasible.
