Name and Location
Minas-Rio iron-ore project, Minas Gerais, Brazil.

Client
Anglo American Brazil (Anglo Brazil).

Project Description
The Minas-Rio iron-ore operation has resources of about 5.77-billion tons and further resource potential exists.

The project comprises three assets – Serro, Itapa and Serra do Sapo (largest orebody) – and will involve the construction of a 525 km 26-inch-diameter slurry pipeline, which, when complete, will be the longest and the largest-tonnage iron concentrate pipeline in the world.

Minas-Rio includes the development of a mine at Conceição do Mato Dentro and the construction of a beneficiation plant at Alvorada de Minas.

The beneficiation plant will convert the iron-ore into high-grade pellet feed. The pellet feed will be mixed with water to form a slurry, which will be pumped along the slurry pipeline to the coast at Açu, near São José de Barra, in Rio de Janeiro state.

There the pellets will be dried before being loaded onto ships.

Net Present Value/Internal Rate of Return
Not stated.

Value
The cost of building the mine is expected to increase from $5.8-billion to at least $8.8-billion, if a centrally held risk contingency of $600-million is used in full.

Duration
In Anglo American’s half-year financial report in July 2012, it reported that, subject to resolving the existing licence challenges facing the Minas-Rio project by the end of 2012 and additional unexpected interventions not being encountered, first ore on ship was expected to be delayed to the second half of 2014.

Latest Developments
The first ore from the Minas-Rio iron-ore project has been shipped within budget.

The more than 80 000 t of iron-ore for the pellet feed market has been loaded onto a chartered vessel at the dedicated export terminal at the Port of Açu, in Rio de Janeiro.

The vessel is currently en route to customers in China.

This followed the receipt of an operating licence, this month, for the 525 km pipeline that transports the iron-ore, mixed with water in a slurry, to the company's ore docks at the port.

Anglo will now turn its focus to the ramp-up, over the next 18 to 20 months, to its first-phase capacity of 26.5-million wet tonnes a year of high-quality, low-contaminant iron-ore pellet feed.

Key Contracts and Suppliers
Ausenco (conceptual design; feasibility study; basic, advanced and detailed engineering; supervision for earthmoving; detailed design; procurement support; and construction supervision); Construçoes e Comercio Camargo Correa (slurry pipeline) and Turner & Townsend (Phase 1 – capital and project schedule review, ongoing contracts administration and cost control. Phase 2 – preparation of the Fédération Internationale des Ingénieurs Conseils document for professional services and the negotiation and settlement, in conjunction with Anglo American, of the professional services contract).

On Budget and on Time?
The project has been delayed several times, owing to a combination of market and environmental factors.
Despite these challenges, first ore from the project was shipped in October 2014.

Contact Details for Project Information
Anglo Brazil, tel +55 21 3031 3434.
Ausenco, tel +1 925 939 4420 or fax +1 925 937 8875.
Construçoes e Comercio Camargo Correa, tel +55 11 384 5511.