Modern Mining August 2015

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August 2015 MODERN MINING43
IRON ORE
WP ad 90x260.indd 1 2015/04/20 10:43
achieve commercial production in the second half of 2016.
In Liberia, Australian explorer Tawana Resources has
slowed engineering and direct design work associated with
the PFS on its Mofe Creek project with the aim of conserving
cash. It did announce recently, however, that the discovery of
Direct Shipping Ore on one of its newly acquired tenements
offered “a potential strategic opportunity to mine and supply
high-grade feed to an early start-up, low capital intensity proj-
ect at a significantly reduced OPEX and CAPEX cost, due to
very simple crushing and screening requirements only (i.e. no
beneficiation).”
Although it is not normally considered an iron ore destina-
tion, Nigeria reportedly has iron ore resources amounting to
around 3 billion tonnes (and some limited production). There
is also at least one iron ore project under development. This
is Agbaja, owned by ASX-listed Kogi Iron, headquartered
in Perth. Kogi has completed a PFS which confirmed the
viability of a 5 Mt/a project (with a capex of nearly US$500
million). Kogi, however, has said this year that it is actively
pursuing a “value realisation process”, which means that it
is open to selling the asset or alternatively securing some sort
of joint venture.
Moving further north to Mauritania, the country is the sec-
ond biggest producer on the continent after South Africa. All
of its production– roughly 13 Mt/a – is through SNIM (Société
Nationale Industrielle et Minière), mainly owned by the state,
which operates several mines. Glencore (through its subsidiary
Sphere Minerals) was planning to build the US$900 million
Askaf mine in the country, with an initial capacity of 7,5 Mt/a,
but the project has now been put on hold until the iron ore
price provides some relief.
Summing up, Africa clearly has tremendous iron resources
which have – by some estimates – the potential to support an
annual production of 400 Mt, which is in excess of what is cur-
rently being produced by Brazil and Australia’s Pilbara region,
the two biggest sources of iron ore in the world. The problem
is that many of the African projects outlined here would need
an iron ore price at least US$30/tonne better than what it cur-
rently is (around US$60/tonne) to make economic sense. This
being the case – and with many forecasters predicting further
falls in the price – it seems fair to say that Africa’s emergence
as the world’s next big supplier of iron ore is still years away. 
Drill rig working at Ferrum Crescent’s Mooonlight iron ore project in Limpopo
Province, South Africa (photo: Ferrum Crescent).