The definitive feasibility study for Stage 1 and the prefeasibility study for Stage 2 of iron-ore developer Sundance Resources’ Mbalam project, on the border of Cameroon and the Republic of Congo, are now complete.
The feasibility studies confirmed the technical and economic viability of the project, which is set to produce 35-million tons a year.
Sundance will first mine its high-grade hematite reserves, which holds an estimated 352-million tons at 62.4% iron for ten years. The company will then develop its itabirite hematite deposits, which hold 3.7-billion tons of reserves.
These deposits are expected to produce a high-quality concentrate product contain- ing 66% iron with low levels of impurities, promising a good recovery and a relatively course grind size.
Stage 1 comprises the construction of a 510 km railway line to transport the ore from Nabeba, in the Republic of Congo, to Cameroon’s Lolabé port. There will also be a 70 km rail spur line to the Nabeba mine, in the Republic of Congo.
The infrastructure project will also involve the purchase of six trains, each consisting of three locomotives and 190 wagons.
A deep-water port will be constructed in Lolabé to handle bulk iron-ore carriers of up to 300 000 deadweight tons.
Stage 2 will be funded by iron-ore production from Stage 1 of the integrated mine, rail and port operation. Sundance expects capital expenditure of about $4.7-billion for Stage 1 and a further $3.1- billion for Stage 2. Operating costs for Stage 1 are estimated at $21.20/t.
Environmental approval was granted for the port, rail and mine projects by the Cameroonian government in 2010. The government also declared the port ‘land for public utility’ in 2010, followed by the rail corridor in 2011.
Preliminary planning of construction works for the port began last year.
Further, Sundance has entered into final negotia- tions with contractor China Rail Construction Corpora- tion (CRCC) for the con- struction of the Stage 1 32 t axle load heavy-haul railway. The company has also commissioned a basic design for the railway line to be provided for CRCC for further detailed development.
Progress with contractor China Harbour Engineering Company (CHEC), which is responsible for the delivery of the deep-water iron-ore port terminal, has been excellent, says Sundance.
CHEC’s tender is being reviewed before Sundance enters into final negotiations to confirm the contractual arrangement for the construction of the Lolabé port.
Construction on the port and rail will start once final government approvals and project financing are secured.