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

Client
Sundance holds a majority interest in subsidiaries Cam Iron and Congo Iron, whose principal asset is the Mbalam-Nabeba project.

Project Description
Following the completion of a definitive feasibility study, which was released in 2011, Sundance’s focus was on the development of two mines, a new port and the required rail system to transport the ore from the mine to the port at a rate of 35-million tonnes a year.

The project now comprises the development of an iron-ore mine, processing plant and associated infrastructure – on Exploration Permit 92 held by Cam Iron in the Eastern province of Cameroon (Mbarga); and on the Mining Permit Nabeba Bamegod held by Congo Iron, in the Sangha province of the RoC (Nabeba).

The focus is to develop the mines at an increased capacity of 40-million tonnes a year of high-grade hematite for a life-of-mine of about 13 years, and then at least 35-million tonnes of high-quality concentrate for a further 15 years.

The project will use a 540 km rail line dedicated to the transport of iron-ore through Cameroon and a dedicated mineral export terminal designed to receive bulk iron-ore carriers of up to 300 000 t.

The rail and port infrastructure will be financed, built and owned by the government of Cameroon.

Net Present Value/Internal Rate of Return
Not stated.

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

Duration
Not stated.

Latest Developments
The signing of an engineering, procurement and construction (EPC) contract for the construction of the port and rail infrastructure for the Mbalam-Nabeba iron-ore project has been postponed at the request of the contractor.

The selected EPC contractor has said that while it continues to support the project, the signing of the contract had to be postponed until market conditions have improved and it can progress its financing.

The EPC contract between the government of Cameroon and the Chinese State-owned construction company had been slated for signing in the December quarter of last year.

The postponement of the EPC contract has been unexpected for Sundance and the government of Cameroon, given the recent advances made with the EPC contract. Sundance is assessing the impact of this postponement on the Mbalam-Nabeba project.

In July, Sundance entered into a transition agreement with the government of Cameroon, which would result in government’s funding the port and rail infrastructure required for the iron-ore project.

Under the terms of the transition agreement, the Cameroon government had committed to funding the development of the port and rail infrastructure in Cameroon through a loan from China or other “friendly countries”.

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.

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 Antonio Capinha, tel +351 214 158 200, fax +351 214 158 700 or email Antonio.capinha@mota-engil.pt.