Frank Timis, executive chairman of African Minerals, a London-based mining company with interests in West Africa, stated on June 3 that the company has signed an exclusive sales agreement with China Railway Materials Commercial Corp., according to which the Chinese company will invest $280 million to gain a 12.5 percent stake in African Minerals. The agreement is now being assessed by the Chinese government.
According to the agreement, after the Tonkolili iron mine in Sierra Leone owned by African Minerals is put into production, China Railway Materials Commercial Corp. will receive iron ore supplies from this mine. When phase 2 of this project is completed in 2014 or 2015, then the Chinese enterprise will receive 18 million mt of magnetite iron ore per year.
African Minerals said it plans to eventually to supply 75 million mt of iron ore per year to China, through development in 3 phases. The phase 1 output capacity will be 5-8 million mt, phase 2 output capacity will be 45 million mt, followed by phase 3 output capacity of 75 million mt. Investment capital for phase 1 is ready.