Sierra Leone’s iron ore mines remain at a standstill, with no early restart foreseen, after foreign miners’ rights were confiscated, traders and producers said in the week started Nov. 15. Land tenure rights, for which no legal framework has been defined in the country’s latest mining code, may be the central issue.
Traders told S&P Global Platts they had not seen Sierra Leone iron ore in the market for a long time. Exports of 20 million mt/year in 2014 sank to less than 1 million mt in 2018, according to industry consultant Roskill. Two shipments of 65% Fe concentrate, totaling 170,000 mt, followed in mid-2019 from the Marampa mine, operated by SL Mining, a subsidiary of UK-based trader Gerald Group, before exports were prohibited.
Exports started to dry up from Tonkolili, a major mine operated at the time by China’s Shandong Iron & Steel, late in 2018, coinciding with publication of the country’s latest Mineral Policy.
According to producer, analyst and press reports, Shandong’s mine rights were later sold by the government to another Chinese operator, China Kingho. Investments are needed for a second phase investment at Tonkolili as the first stage product is largely sold out. The second phase, at the planning stage, aims to process the site’s original 30% Fe content into a 65%-68% concentrate.
Reports said Kingho has so far not produced anything at the mine and local opposition has also led to Kingho’s license being blocked.
“Everything has been stopped. Iron ore from Sierra Leone is becoming increasingly less relevant to the international market,” said Erik Sardain, principal consultant, steel alloys, with Roskill. “It’s too much struggle for producers who have invested time and effort and find they have no way of dealing with the Sierra Leone government.”
The country’s mining sector was several years ago disrupted by civil war and Ebola. Recently, unrest flared because local people want mining to go ahead as this may be their only source of revenues, Sardain said in an interview.
Sierra Leone has confiscated rights to both the Tonkolili and Marampa mines, according to previous company and local reports. While SL Mining has since won rulings in its favor, including from The International Chamber of Commerce’s emergency arbitration tribunal, authorizing it to resume exports from Marampa and have its license reinstated, the government did not allow this, and even temporarily detained several SL Mining executives earlier this year. Before Shandong, Tonkolili was operated by African Minerals. Marampa was previously operated by London Mining.
Source : https://www.hellenicshippingnews.com