Simandou and other West African iron ore development faces major opportunities
According to MiningWeekly, Roelof van Tonder and Duncan Bonnett, directors of research and consulting firm Africa House, mentioned Guinea's Nimba when discussing investment opportunities in Africa. ) and the Simandou iron ore.
The Nimba Iron Mine is located in southeastern Guinea. It is a high-grade deposit that can be exported directly by ship. The owner is High Power Exploration Inc. (HPX).
The company has raised US$200 million to develop the Nimba Iron Mine, hoping to produce 15 million tons of iron ore per year after it is put into operation, and plans to increase its production capacity to 30 million tons per year.
What makes this project even more attractive in terms of business opportunities is the need to build a new batch of infrastructure in Liberia.
To expedite the movement of ore from the mine to the Port of Buchanan, Liberia, the Ivanhoe Mines company needed to expand the existing 243-kilometer railroad between Tocade, Liberia, and the Port of Buchanan.
At the same time, the Simandou iron ore mine is the largest undeveloped iron ore group in the world, stretching for more than 110 kilometers, with the north and the south accounting for half.
International mining giant Rio Tinto holds a 45% stake in the northern half, Chalco holds 39.9%, and the Guinean government holds 15%; Win Alliance holds the southern half.
The estimated reserves of Simandou iron ore are 8.6 billion tons, and the north and south parts each contain about 2 billion tons of mineable high-quality iron ore, with a content of 66%-68%.
The first phase of the project requires the construction of a 670-kilometer railway linking the Simandou iron ore mine with the newly built Matacon deep-water port in Guinea.
The railroad will require an investment of $8 billion, while the construction of the port and mine will require another $3 billion.
The second phase requires an additional investment of $5 billion to expand the railway, and another $1.5 billion to expand production capacity and port throughput.
While the Simandou deposit has struggled for years due to ownership disputes and the huge investment required to mine and transport the ore, Bonet and Van Dande believe these issues will soon be resolved to make way for major developments in Guinea.
They believe that Guinea is likely to replace Australia as China's main source of iron ore imports.
This iron ore project in Guinea, together with ArcelorMittal's iron ore mine in Liberia, has the capacity to supply 200 million tons of iron ore per year to China.
"With no problems in sales, and at the same time bringing considerable economic benefits to the host country, construction of new railways and ports for iron ore should be started with more confidence than in the past," Bonet and Van Dande concluded.