Anvwar Asian to wrap up deal
Anvwar Asian Investments, an Oman-based investment company, will conclude its deal to acquire 35 per cent stake in a South African mining project within weeks from Ferrum Crescent.
The Omani firm will pay $10 million for the stake and another $3.5 million for meeting its share of feasibility study for the mega mining/pelletisation project.
Anvwar Asian Investments and an Australian iron ore developer, Ferrum Crescent, are jointly planning to develop an integrated iron ore mine along with a large pelletising plant in South Africa.
Both the parties have signed a letter of intent (LoI) few months ago to acquire the stake by the Omani firm. “We are looking into finalising the structure now. Also, high priority is attached to get the feasibility study team together,” said Robert Hair, managing director of Ferrum Crescent.
The $1.5 billion mining venture — Ferrum Iron Ore — has granted mining right over three farms covering 53 square kilometres. Ferrum Iron Ore will be 62 per cent owned by Ferrum Crescent, 35 per cent by Anvwar Asian Investment and three per cent by Ga Seleka.
The project concept is based on mining, crushing and separating at the Moonlight mining area, to produce concentrate, which will be pumped by slurry pipeline to Thambazimbi, some 220km away.
Hair also noted that once the feasibility study is complete, the promoters will try to finalise financial closure for the project, which will be in the ratio of 40 per cent equity and 60 per cent debt. The whole project is expected to complete by 2018. The area has around 308 million tonnes of iron ore deposits.
The company plans to manufacture six million tonnes of iron pellets per annum at Thambazimbi, with most of the product to be transported some 900km by rail to Richards Bayfor for exporting to overseas markets, especially to steel producers using electric arc furnaces and requiring direct reduction grade pellets. Some product may be sold to local steel producers within South Africa.
Klaus Borowski, director of Ferrum Crescent, said that there is a potential to set up a steel cluster in Oman, once the pelletising project in South Africa ensures pellets for a steel project in the Sultanate.
Hair and Borowski were in Muscat recently to discuss with their Omani partner. “The idea is to set up a steel cluster in Oman with the plan to produce 2.5 million tonnes of finished steel per annum using iron pellets from South Africa,” added Borowski. The Omani steel project can easily export finished products to India as well, which is a great advantage, he added.
Anvwar Al Balushi, chairman of Anvwar Asian Investment Group, said iron and steel are in demand in the entire Gulf region due to implementation of several major infrastructure projects.
“This demand will sustain for another ten to fifteen years,” he said, adding; “The demand for steel is seen not only from Oman, but from the entire region, including Dubai and Qatar.”