Name and Location
Mbalam-Nabeba iron-ore project, between Cameroon and the Republic of Congo (RoC).

Client
Sundance Resources.

Project Description
The project scope will be to mine 35-million tonnes a year from iron deposits in Cameroon and the RoC and to construct a 510 km rail line from the Mbarga mine, in Cameroon, and a 70 km rail spur line, connecting the Nabeba mine, in the RoC. The rail line/spur will transport iron-ore to the Cameroon coast.

The scope will also include construction of a new deep-water iron-ore export terminal at Kribi, which will accommodate bulk iron-ore carriers of 300 000 deadweight tons in size.

The project will be completed in phases, with Stage 1 focusing on a direct shipping ore (DSO) project for a minimum of ten years and Stage 2 extending the life of the operation by more than 15 years for the production of high-grade itabirite hematite concentrate.

Stage 1’s mineral reserves currently total 436.3-million tonnes at 62.6% iron.

Net Present Value/Internal Rate of Return
Not stated.

Value
A capital expenditure of $4.6-billion will be required to start up the DSO operation.

Duration
Construction is planned for late 2014, with a targeted first iron-ore shipment planned for the last quarter of the same year.

Latest Developments
Sundance has entered into a transition agreement with the Cameroon government that will result in government funding the port and rail infrastructure required for the Mbalam-Nabeba iron-ore project through a loan from China or other “friendly countries”.

Government has started a process to select an engineering, procurement and construction contractor to develop the rail and port infrastructure to support its application for a loan from financial institutions.

It will likely take t government 6 to 12 months to secure the required funding.

The Cameroon government will own 98% of the port and rail infrastructure entities, while Sundance subsidiary Cam Iron will own the remaining 2%, in recognition of the capital it has invested in that infrastructure.

“Sundance will, however, be obligated to secure financing for the development of the mines within nine months after the Cameroon government achieves its financing commitment for the port and rail infrastructure.

If this is not achieved, Cam Iron could, at the request of the Cameroon government, be required to transfer exploration licence 92, which has been extended to July 24, 2017, to a nominee of government for no consideration.

Meanwhile, under the terms of the agreement, Cam Iron and fellow Sundance subsidiary Congo Iron will enter into take-or-pay agreements incorporating a commercial tariff for each tonne transported and loaded using the port and rail infrastructure.

Key Contracts and Suppliers
WorleyParsons (prefeasibility study); Mota-Engil Africa (EPC) and Standard Bank (funding and lead debt arranger).

On Budget and on Time?
Too early to state.

Contact Details for Project Information
Sundance Resources, tel +61 8 9220 2300, fax +61 8 9220 2309 or email info@sundanceresources.com.au.
Mota-Engil Africa communication office Dr António Capinha, tel +351 214 158 200, fax +351 214 158 700 or email Antonio.capinha@mota-engil.pt.