25/07/2014 - 13:57

Sundance signs Congo convention

25/07/2014 - 13:57

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Sundance Resources has taken a step toward production at its Nabeba iron ore project after signing an agreement with the government of the Republic of Congo and Congo Iron.

Sundance signs Congo convention
Sundance Resources chief executive officer Giulio Casello.

Sundance Resources has taken a step toward production at its Nabeba iron ore project after signing an agreement with the government of the Republic of Congo and Congo Iron.

The signing in the Congolese capital of Brazzaville today follows the issuing of a mining permit for the project in December 2012, and details taxation and regulatory requirements for the development.

The agreement includes a 25-year operating licence with possible 15-year extensions, a 3 per cent royalty on iron ore produced, and a five-year corporate tax holiday with an additionally reduced rated for five years thereafter.

But a non-dilutory 10 per cent stake in Sundance subsidiary Congo Iron will be granted to the Congolese government.

Sundance believes stage one of the deposit will produce 35 million tonnes of iron ore per annum for 10 years, and earlier this year signed an offtake deal with Noble Resources International.

Sundance managing director Giulio Casello said the Congo-Brazzaville government had offered strong support since exploration operations started in 2010.

“In just four years we have achieved extraordinary success in the Republic of Congo, with the Nabeba deposit now boasting a significant high-grade hematite reserve as well as substantial itabirite resources,” Mr Casello said.

“This world-class inventory will underpin a successful mining operation for many years, generating substantial economic benefits, including employment opportunities, for the Congo people.

“Nabeba is an outstanding deposit.

“When coupled with the complementary characteristics of the Mbarga deposit in Cameroon, and the access to market that will be provided by the project’s rail and port infrastructure, it is clear that huge value is about to be unlocked for all stakeholders.”

Sundance traded up 3.49 per cent today to 8.9 cents per share at the time of writing.

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