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Sundance expecting Mbalam offtake deals

September 17, 2010


Sundance Resources Ltd says it is aiming to have offtake agreements by the end of the year to allow construction to start at its Mbalam iron ore project in West Africa.

Sundance chairman George Jones said discussions with partners were "well advanced".

"We are currently actively negotiating on several fronts to secure both off-take contracts and project finance with steel mills," he said in an interview released to the Australian stock exchange.

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"We are aiming to have all of these foundation agreements in place before the end of this calendar year to enable us to start construction by the middle of next year," he said.

The Mbalam project is located in Cameroon.

23 March 2011
Sundance hunt for strategic partner

Sundance Resources Ltd says a strategic partner for its $US4 billion Mbalam iron ore project in West Africa is most likely to be a Chinese state-owned steel mill.

Sundance, an Africa-focused iron ore explorer, says it hopes to secure one or more strategic partners this year but did not indicate whether its newest and largest shareholder, China's Hanlong Mining, was being considered.

However, it did say talks about a strategic partner were the most advanced with Chinese state-owned steel mills although potential partners elsewhere in Asia, India and Australia had also been approached.

The Mbalam project involves a 480km rail line to the Kribi port on the Cameroon coast and two mines in the republics of Cameroon and Congo, all of which will be constructed by Sundance.

The project is a large undertaking where Sundance will seek strategic partners to share the cost.

Sundance chief executive Guilio Casello did not indicate whether Hanlong Mining was being considered as a potential strategic partner.

But involvement would likely be largely Chinese, Mr Casello told the Global Iron Ore and Steel Forecast conference in Perth on Wednesday.

"We have been in discussions with a number of strategic partners and it's not just been solely Chinese - there have been others from Asia, India and Australia.

" ... predominantly we are focusing (on) ,and our discussions are most advanced with, state owned-Chinese steel mills who are looking to buy in at the project level to lock in iron ore supplies," Mr Casello said.

He said the iron ore explorer was on track to deliver a definitive feasibility study for the Mbalam project by the end of this month, which was expected to confirm a revised capital cost estimate of $US4 billion ($A3.97 billion), up from $US3.6 billion ($A3.57 billion) previously.

Mr Casello had recently flagged the likelihood of a cost increase, given the scope of project had been expanded to include the Nabeba deposit, which will be the second mine, and extra rail required.

The other mine, Mbarga, would be mined simultaneously, Mr Casello said.

A final investment decision remains slated for the fourth quarter of 2011, while first ore on ship is expected in the first quarter of 2014.