London-headquartered metals and mining company Vedanta Resources is exploring better quality iron ore at its Liberia mines as a sharp fall in ore prices globally cast a shadow on the future of the project that is already beset with Ebola crisis in West Africa and a lack of transport infrastructure.
Located in western Liberia, the Western Cluster project consists of three mining concessions - the Bomi, Mano and Bea - with over three billion tonnes of iron ore resource. Vedanta invested $96 million on exploring the resources until March 2014, according to its annual report.
"We have encouraged the geologists to look for more attractive portions of resources that have a mineralogy that would be more conducive for a low iron ore-price environment," CEO Tom Albanese told ET.
Anil Agarwal-led Vedanta was engaging with the Liberian government on infrastructure solutions for evacuation of the ore once mining operations starts, through roads, railways and ports.
Albanese said Vedanta is going slow on its efforts in Liberia due to the outbreak of Ebola virus.
"Unfortunately, in the current weak iron ore environment, given that it is a magnetite resource, it (project) is a very challenging economic prospect," Albanese added.
Iron ore prices have fallen to almost half in the past one year and are expected to fall further, putting a question mark on investments made in exploration and mining for the key steelmaking commodity.
Source: ET
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