Iron ore junior, Ferrex and engineering major, DRA have signed a memorandum of understanding to begin the final bankable feasibility study for the engineering and design development at the company’s Tivani iron ore project in South Africa’s Limpopo province.Ferrex is one of a few junior companies looking to develop iron ore projects in the region. The iron ore industry is robust and is fortunately in a position of growth, especially by comparison with South Africa’s PGM industry in particular. As such, a host of new players are coming into play. Ferrum Crescent is working towards the completion of its bankable study for its Moonlight iron ore project and Bushveld Minerals Mokopane project could be a world-class magnetite hosted deposit, said to contain up to 2 billion tonnes. The Tivani project has an estimated resource of between1.5 and 2 billion tons to produce iron ore, titanium and vanadium.
Ferrex is nearing completion of all pre-production regulatory and non-regulatory matters which will enable construction of an iron ore concentrator to begin, with a capacity of 11 Mtpa of run-of-mine ore.“This is yet another significant step in the Ferrex story; following the announcement last year that Ferrex had signed a US$1.7 billion (R14.87 billion)mandate letter with the Johannesburg division for The Hongkong and Shanghai Bank Corporation (HSBC), to act as the exclusive financial advisor to Ferrex regarding the raising of the capital required for the Tivani project. The combination of DRA and HSBC is indicative of Ferrex’s goal to start mining and concentrate production within the next nine to 18 months,” Says Ferrex chairman, Jeff Ahbe. “Capital costs, which will be scaled through the initial phases of mining and concentrate production, are projected at between US$50 million and US$200 million with associated production estimated at 1Mtpa production will be ramped up to an estimated 2.5 Mt of concentrate per annum with additional estimated capital of US$200 million within 18 to 36 months.” “DRA is excited to be selected to provide the bankable feasibility study for the project. This study will complement our existing iron ore portfolio and strengthen our dominance in the South African iron ore project environment. We look forward to developing the relationship with Ferrex,” says Paul Thomson, CEO of DRA.