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LONDON (Alliance News) - Glencore Xstrata PLC and AIM-listed Zanaga Iron Ore Company Friday said they had changed the terms of a deal to advance the joint venture Zanaga Iron Ore Project, with a feasibility study now being advanced on a staged development basis, meaning capital expenditure on the project will be lower and they will seek partners to provide debt or equity to advance the project.
Under the new terms, the companies said they might start production using existing infrastructure at the site.
Glencore will still be funding the majority of the initial works at the site, but under the revised deal, Zanaga Iron Co will now also contribute USD17 million to the work programme, which has been extended to December 2014. Zanaga said it would pay in stages from its existing cash reserves.
The companies said the feasibility study will be completed in the second quarter of 2014, and will then form the basis for an application to the Republic of Congo Government for a mining exploitation licence.
Any investment decision for the project would follow the conclusion of the feasibility study, Glencore and Zanaga Iron Co said in a joint statement.
By Steve McGrath; stevemcgrath@alliancenews.com; @SteveMcGrath1
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