AVZ (ASX) Ann: Manono Project Update

Infrastructure has covered by @stakx (thanks)

Here's stakx's excellent post:
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For all those people, unfamiliar with infrastructure in/near Manono in the DRC.

The Manono project is approximately 500km due north of Lubumbashi the capital of the Katanga Province in the South of DRC. The project area can be accessed from Lubumbashi by 1.5-hour flight or by road. There are roads there, but in poor condition. Mpiana Muanga Hydroelectric Power Station and transmission lines were damaged in 2007 by militant forces which require repairing. Dathomir Mining Resources SARL (10% owner of Manono project) will undertake repairs to this to facilitate the planed mine. Dathomir is co-ordinating the commitment of capital expenditure of up to USD $345 million for road upgrading from Lubumbashi to the project and refurbishment of the Piana Mwanga hydro facility. High quality road currently being built by China First Railway from Lubumbashi to Manono. Estimated to take 12 - 24 months to complete. The 1st 200km is already under construction.
Contracts were awarded to the state-owned China Railway Construction Corporation Limited to rebuild the Luanda Railway and the Benguela Railway. A privately-owned Chinese mining company rebuilt the Moçâmedes Railway stretching 2,638 km in Angola the DRC’s neighbouring country. narrow gauge 1,067 mm (3 ft 6 in): The Benguela Railway connects to the Katanga Railway at the border with the Democratic Republic of the Congo.

The maximum design speed is 90 km per hour.The design capacity is 20 million tons of cargo and 4 million passengers per year. There are 67 stations and 42 bridges along the route of the railway
Passenger trains also ran between Lubumbashi and Lobito, connecting with passenger ship services to Europe. This provided a shorter route for Europeans working in the Katangan and Zambian Copperbelt, and the name "Benguela Railway" was sometimes used loosely to refer to the entire Lubumbashi–Lobito route, rather than the Luau–Lobito section to which it strictly applies.http://www.railwaygazette.com/news/...ents-inaugurate-rebuilt-benguela-railway.html

China Railway Construction Corporation Limited (abbreviated CRCC) is a state-owned construction enterprise based in Beijing China, that is the second largest construction and engineering company in the world by revenue in 2014. They loaned Angola $500 million USD interest free in 2006. See link http://china.aiddata.org/projects/39153?iframe=y
http://www.chinadaily.com.cn/business/2017-03/26/content_28682186.htm
And another link http://africachinareporting.co.za/2...the-scramble-to-access-the-regions-resources/

The preferred route would be to the port of Dar Es Salaam in Tanzania as it is the shortest route to china and the 1st segment of this article is relevant to DRC’s AVZ https://www.reuters.com/article/us-...oan-for-tanzania-port-expansion-idUSKBN19N0NG
And another link http://news.xinhuanet.com/english/2017-07/02/c_136411443.htm

It is noted that outcrops and exposures in pits suggest that the two largest pegmatites are the Carriere de L’est Pegmatite and the Roche Dure Pegmatite. Each of these alone is evidently as large or larger (Figure 2) than the famous Greenbushes Pegmatite in Western Australia where current resources are stated as 120Mt of 2.4% Li20.

Port of Lobito http://www.megaloglda.com/index.php/en/port-of-lobito
China has built the largest port in Africa at Lobito
AVZ general info http://www.4-traders.com/AVZ-MINERA...ition-of-interest-in-Manono-Project-23834432/
Information formulated directly from company announcements and links provided.
Aug 2017 AVZ Announcement
Sept Quarterly report 2017

Manono Project previously owned by Geomines SA (Belgium mining company); operated 6 open pit mines from 1910-1982 on the Manono Kitotolo pegmatites, producing 140,000 - 185,000 tons of tin concentrate (Zairetain 1981).
The pegmatites located within the Manono Project extend for a strike length of at least 13km, however only a limited portion was tested by historical mining and exploration activities. According to publicly available records, the Manono pegmatites were mined for their tin content between 1919 and 1980, during which time approximately 185,000 tonnes of cassiterite concentrate was produced, at an average of 1,850gm of cassiterite concentrate per cubic metre (g/m3) or approximately 1,330g/m3 tin. The ore was sourced mainly from alluvial and weathered pegmatite, and the pits were completed to a depth of between 25 and 45 meters.

The profit-based tax for instance is set at the preferential rate of 30% (as opposed to the 40% corporate tax rate) and is levied on the net profits from exploitation. Mining royalties are currently set at 2% for non-ferrous metals.
Majority of mines located near Manono are focused on Tin with China
Minmetals operating a copper mine within 200km.
DRC Electrical Infrastructure
Piana Mwanga Hydro - Piana Mwanga would comprise an installation of up to a 32MW power plant- rehabilitation and addition of one unit.#
The project was last evaluated in about 1990.
The project needs to be restudied and data brought up to date, before being included in a generation plan. Earliest on-power is estimated to be 2018.
There is room for 4 gen sets for total production of 64MW. Dathomir and Cominiere have agreed that Dathomir will secure up to USD45M funding for the rehabilitation of the Piana Mwanga hydroelectric power station.
Multiple Train Transportation Options Exist
Road to Lubumbashi then three rail freight options:
Lubumbashi and from there to Dar es Salaam the route that tin and cobalt exports presently utilize.
Lubumbashi and from there to Durban, South Africa as the copper mines current utilize.
Angola by the Katanga Railway and then via the new route Benguela railway from Lobito on the Atlantic.

https://hotcopper.com.au/threads/po...mber-3.3735798/?post_id=27692355#.WfN5FtE_Wf0

Another excellent post from @orionwoo (thanks)

Orionwoo's post:

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Personally I don't think it's fair to apply too heavily discount to DRC projects. First of all, global demand is way exceeding the Lithium supply outside of DRC. Next thing is, China's involvement in that region reduces lots of risk IMO.

Plus, let's take a look of the new one belt one road map:

The circled area should be DRC if I understand it correctly. See how close that is to the new maritme silk road. Chinese companies could easily take advantage of it & build onsite factories near the mine. This reflects what you said in the earlier posts re what you were told by industry advisers. Hence that's why Chinese value DRC projects differently with lots of Australian firms / professional individuals as they simply know that place so much better than anyone else in the world. Now put ourselves in their position, it would be a no brainer to spend some money to secure a world class future resource as early as possible. It's a national strategy thing IMO, simply too big to ignore.

I certainly think 50c should be very doable in near term & $1 valuation isn't too insane as are simply too cheap at the moment comparing with peers.

https://hotcopper.com.au/threads/ru...04088/page-2069?post_id=28214247#.WfO1HNE_Wf0

Benguela railway handover

19 Aug 2017

ANGOLA: Construction company China Railway 20 Bureau Group has formally handed over further sections of the 1 301 km Benguela Railway to the government of Angola.
Events marking the transfer of ownership were held on June 29 in Kuito and on July 27 at Luau, close to the border with the Democratic Republic of Congo. Benguela Railway President José Carlos Gomes, who died in a road accident in early August, said that the handover marked the end of the contract with CR20 which had started in 2008.

On July 25 the Benguela Railway Training School in Huambo was formally opened by Transport Minister Augusto da Silva Tomás and governor of Huambo province João Baptista Kussumua.

http://www.railwaygazette.com/news/infrastructure/single-view/view/benguela-railway-handover.html

Trains resume between Kolwezi and Dilolo

16 Aug 2016

A train carrying SNCC management and other guests reached Dilolo on August 11.

DR CONGO: Ahead of the relaunch of regular passenger and mail trains on August 25, Ilunga Ilunkamba, Director-General of state railway SNCC, joined a special train inspecting the upgraded route between Kolwezi and Dololo on August 11.

No trains have used this 422 km section of the former Benguela Railway in northwestern DR Congo for two years because of a sharp decline in the standard of the infrastructure at several locations. However, following work to stabilise the formation, replace track and repair defects over sections totalling approximately 110 km, freight and passenger trains can now resume. A twice-daily passenger and mail service is envisaged between Dilolo and Lubumbashi, but most traffic will be agricultural and mining commodities.

The repairs are intended to precede a more comprehensive upgrading of the railway as part of the government’s plans to improve transport links to and within the Copperbelt region. The resumption of rail services to Dilolo marks a major milestone in the revival of the Benguela Railway, which runs westwards into Angola to reach the port of Lobito.

The Angolan section between the border at Luau and the port has been extensively rebuilt using Chinese funding, but few trains have used it since the work was completed in August 2013 because almost all its potential traffic would originate in DR Congo.

http://www.railwaygazette.com/news/...trains-resume-between-kolwezi-and-dilolo.html