ASX-listed emerging African iron-ore producer Genmin has signed a nonbinding memorandum of understanding (MoU) with Baosteel Resources, a subsidiary of steel producer Baowu Resources, for the potential offtake by Baowu of Baniaka Green iron-ore products produced at Genmin's Baniaka iron-ore project, in Gabon.
Genmin has set out to produce a suite of greener, higher-value iron-ore products at its flagship Baniaka mine – with these products to be sold under the trademarked Baniaka Green brand – by implementing eco-friendly, energy efficient and cleaner production technologies.
As part of efforts to decarbonise its operations, Genmin in February entered into a 20-year agreement with Gabon's State-owned power utility for the supply of an initial 30 MW of electricity from the Grand Poubara hydropower plant, located on the Ogooué river, about 35 km northeast of Baniaka.
This could be increased to 50 MW in future, should the iron-ore mine require the additional power.
"We are delighted and honoured to have established a relationship with Baowu, a group of substantial leadership, reputation and influence in our industry. The signing of this significant MoU confirms that the market potential for Genmin’s high-quality, Baniaka Green iron-ore products to contribute to the decarbonisation of our industry has been recognised,” says Genmin MD and CEO Joe Ariti.
Under the terms of the MoU, Genmin plans to enter into a legally binding offtake agreement with Baowu, by December 31, 2024, for the delivery of 1.2-million tonnes a year of fines, 500 000 t/y of lump and 400 000 t/y of pellet feed product from Baniaka for a term of two years.
Genmin has, thus far, also entered into nonbinding MoUs with international trading house Minmetals, as well as steel manufacturers Jianlong and Hunan Valin for potential offtake of iron-ore products from Baniaka. Along with its latest MoU, Genmin is poised to supply about 16.9-million tonnes of Baniaka Green products for terms of two or three years.