Australian miner Sundance Resources has agreed terms with the Republic of Cameroon to develop the Mbalam iron ore project, the third largest unexploited iron ore project in the world. Mbalam is located around 485 km east of the coastal city of Kribi and spans the border with the neighboring Democratic Republic of Congo (DRC).
The agreement is based on a convention between Sundance, China-based Sichuan Hanlong Group and the Cameroon government. Sundance has also received a mining permit for the project from the Democratic Republic of Congo.
Completion of the agreed terms will enable Sichuan Hanlong Group to proceed with its acquisition of Sundance at 57 cents a share, subject to approval from China's National Development and Reform Commission (NDRC).
The integrated mining project will comprise a mine, railway infrastructure of about 570 km and a port facility with a minimum capacity of 35 million metric tons per year. Initial estimated capital investment for the project is $5 billion, with an additional $3.7 billion investment for the beneficiation stage of the project.
"The mine will operate for 25 years with the prospect of this development lasting for many decades past its planned 25 years," said Sundance and the Cameroon government in a joint statement.