December 07, 2020 (232News)
FREETOWN – Report from Hellenic Shipping News World Wide, an online delay newspaper on Hellenic and international shipping has exposed what they described as opaque mining policy as one of the fundamental problems in the mining sector in Sierra Leone.
The report revealed that 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.
The report continues that traders told S&P Global Platts that they had not seen Sierra Leone iron ore in the market for a long time.
That 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.
The report pointed out that 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.
That 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,” the report stated.
“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.”
That Sierra Leone has confiscated rights to both the Tonkolili and Marampa mines, according to previous company and local reports.
That Sierra Leone is failing to benefit from currently high iron ore prices, even though its November 2018 Minerals Policy stated that minerals wealth has been designated as a “primary driving force of economic growth … to be invested in creating a conducive environment for private sector growth.”
The reported pointed out that the National Minerals Agency declined to comment and referred to the Ministry of Mines and Mineral Resources website, which displays the 2018 Minerals Policy.
That a source close to Gerald Group told Platts earlier this year that it did not consider the company’s failure to reach an accord with the Sierra Leone government to be a royalties issue as reported by some sources, as all royalties requested had been paid. “We don’t know what they want,” the source had said.
The report maintained that Gerald Group still has iron ore stocks of about 750,000 mt ready to ship from Marampa — inherited from the previous operator — but has been unable to gain access to these or effectively restart the 6 million mt/year mine.
That sources said that Shandong Iron & Steel has simply quit Tonkolili, even after investing a reported $3 billion in mine infrastructure for which they 9(Shandong) didn’t provide any formal statement.
Source: (https://www.hellenicshippingnews.com/sierra-leone-iron-ore-exits-global-market-as-opaque-policy-sparks-mine-halts/)
