Sundance Resources is part of a consortium selected to construct and operate an iron ore export terminal in Cameroon which is expected to become a major shipping hub that will service the company's Mbalam iron ore project.
Sundance Resources is part of a consortium selected to construct and operate an iron ore export terminal in Cameroon which is expected to become a major shipping hub that will service the company's Mbalam iron ore project.
The company submitted its proposal both as an independent operator and as part of a consortium, including Rio Tinto Alcan, to the government.
In a previously released report, Sundance estimated total port and associated infrastructure costs at $US529 million.
Shares in Sundance were up one cent to 11c at 15:47 AEDT.
The announcement is below:
Sundance Resources Limited (ASX: SDL - "the Company") is pleased to announce that its Cameroon operating subsidiary, Cam Iron SA, has been selected to develop an iron ore export facility as part of a multi-user deepwater port project south of the coastal town of Kribi in Cameroon, West Africa. Under the Government proposal, the new port is to be developed as a multi-user facility by some of the largest resources, logistics and construction companies in the world.
The new port is expected to become a major shipping hub servicing the Mbalam Iron Ore Project as well as other emerging industries in the region. The announcement was made last week by the Cameroon Minister of Transport, Mr Gounoko Haounaye, acting as Vice Chairman of the Steering Committee coordinating the port development. It follows review of proposals from a range of international developers and port operators.
Cam Iron SA submitted its proposal to the Cameroon Government both as an independent operator and as part of a consortium comprising Rio Tinto Alcan, the Bolloré Group and the Vinci Group - all major international companies with existing operations in Cameroon. Rio Tinto Alcan is a leading global supplier of bauxite, alumina and primary aluminium. The Bolloré Group is a diversified French-based conglomerate whose international logistics division has extensive operations in Africa. The Vinci Group is one of the world's leading construction companies.
The parties selected to participate in the development of the multi-user port comprise:
Cam Iron SA (Financing, construction and operation of the iron ore terminal)
Rio Tinto Alcan (Financing, construction and operation of the aluminium terminal)
Bolloré Group (Financing, construction and operation of the container terminal)
Angelkique / SCDP / Petredec / Camship (Financing, construction and operation of the hydrocarbons terminal)
Vinci / SOGEA / SATOM / Boskalis International (Financing and construction of civil works, infrastructure and utilities)
The iron ore export terminal will be constructed by Cam Iron as a stand-alone facility but with provision for staged development of multi-user operations by the other selected operators.
This should allow for sharing of common infrastructure and utilities. The iron ore terminal will receive, stockpile, reclaim and shipload high-grade DSO and concentrate products for export.
The port site selected by Cam Iron allows development of an open water berth capable of handling ships of up to 250,000 DWT capacity with a berth depth of 22m.
Recent marine surveys have allowed optimisation of the port design with total marine construction costs now estimated to be in the range of US$160 million (excluding materials handling infrastructure and utilities). This is approximately US$50 million less than the cost estimate provided in the Pre-Feasibility Study.
The Cameroon Government has retained specialist international consultants to provide advice on the development process for the multi-user port.
The next steps in this process will comprise:
o development of the Port Master Plan to accommodate the traffic and operational requirements of each of the selected operators;
o award of concession agreements;
o development of technical documentation;
o arranging of funding (target date being September 2009).
Commenting on the announcement, Sundance's Managing Director Don Lewis said: "The selection of Cam Iron as a core operator within the overall port development represents another important milestone for Sundance and the Mbalam Project."
"We welcome the Cameroon Government's commitment to support the development of a deepwater port facility near Kribi, which reflects their strong desire to see this region opened up to significant economic development," Mr Lewis said.
"The Government's announcement gives us great confidence that construction of the new port can proceed in a timely and cost effective manner."
"The involvement of several of the world's leading resources, logistics and construction groups will significantly enhance the ability to secure competitive financing for the development of the port facilities," he said.
"The iron ore export terminal represents a key component of the Mbalam Project. This important announcement follows a number of very positive developments achieved towards the end of last year.
These include the finalisation and signing of the Framework Agreement with the Government of Cameroon, the delineation of a JORC-Code compliant resource base totalling 2.45 billion tonnes of DSO quality and itabirite hematite, completion of the Stage 1 drilling program and the commencement of negotiations with prospective strategic partners with interest in product offtake and financing."
