41 / 60
June 2017
MODERN MINING
39
WEST AFRICA
Study
indicates favourable
economics
for Sanaga
Location of WAFM’s licences, including Sanaga, in Cameroon.
W
hile the commodities collapse has had a negative ef-
fect on West Africa’s many iron ore projects, with
several of them now effectively on hold, at least one
is making some progress. West African Minerals Corporation
(WAFM), whose shares are quoted on London’s AIM, has an-
nounced the details of its recently completed Scoping Study on
the Sanaga project located near the Port of Douala in Cameroon.
According to WAFM (formerly Emerging Metals Limited), the
Scoping Study indicates robust economics and favourable capital
and operating cost fundamentals for an open-pit iron ore mine
and concentrator using transportation to the Cameroon coast
either by barging down the Sanaga River and transhipping at sea
or using a slurry pipeline to a port in the vicinity of Yoyo. The
Sanaga deposit contains previously released CIM-compliant min-
eral resources of 82,9 Mt at 32,1 % Fe.
The Scoping Study was prepared by independent consultants,
Royal HaskoningDHV (RHDHV), in accordance with the JORC
Code (2012). The base case is stated on a pre-tax and royalty basis
assuming 100 % project ownership and using five-year historical
average iron ore prices.
Key outcomes include an NPV
10
of US$262 million to US$292
million, an IRR of 29 to 37 % and upfront capital costs (depend-
ing on the transport option adopted) of US$194 million to US$298
million. Payback is put at 29 to 46 months and the study estimates
24 months to full production from the final investment decision.
Gerard Holden, Chairman of WAFM commented: “WAFM is
very pleased to announce the results of an independent Scoping
Study which has identified two potential pathways to produc-
tion of 2,4 Mt/a of premium grade iron ore concentrate.
“The geometry of the mineralisation, which outcrops at sur-
face, lends itself to low cost, low stripping ratio open-pit mining.
Metallurgical testing on the primary magnetite ores indicates that
the project can produce a high-quality iron ore concentrate prod-
uct (69 % Fe) that will command a premium price in the market
place. The Sanaga project’s proximity to the ocean and access to
existing road and power infrastructure allows low capital expen-
ditures and a short timeframe to develop export infrastructure.”