Roundtable Discussion; The Future of Mineral Sands. Watch the video here.
'....Since Saudi Arabia was selected to host the World Expo 2030 on 28 November, Chinese investors have been flocking to the kingdom looking for steel investments, Kallanish learns from investigation.
"Chinese steel companies' profit margins in China and their subsidiaries in Southeast Asia and the Far East, especially in recent years, have been eroded, so they were looking for new investment opportunities in the fossil fuel-rich Gulf Cooperation Council member states," opines an investment adviser and consultant in China.
( )
A senior steel company official asks Kallanish: "I WANT TO UNDERSTAND WHY FOUR CHINESE STEEL COMPANIES HAVE VISITED ME IN THE PAST TWO WEEKS to form a partnership or JV in the tube-making sector. What was their driving motivation that coincided in the past two weeks?" '
https://www.kallanish.com/en/news/steel/market-reports/article-details/chinese-investors-shower-saudi-arabia-for-steel-investment-1223/
(cough): SAUDI ARABIA WILL LEVERAGE ITS FINANCIAL CAPABILITIES TO SECURE EQUITY INTERESTS IN MINERAL-RICH MINES IN AFRICA
Dec 26, 2023 05:19 Source:SMM
Japan and Saudi Arabia to Cooperate on Procurement of Important Minerals The Ministry of Economy, Trade and Industry of Japan announced on the 25th that a memorandum of cooperation has been signed with Saudi Arabia to ensure the stable procurement of important minerals required for electric vehicles (EVs) and batteries. SAUDI ARABIA WILL LEVERAGE ITS FINANCIAL CAPABILITIES TO SECURE EQUITY INTERESTS IN MINERAL-RICH MINES IN AFRICA, while Japan will strive to ensure the supply of nickel and lithium and promote cooperative investment.
https://news.metal.com/newscontent/102548621
Nice spot, V10. Our Saudi Minister, Bandar Al-Khorayef, recently spent 3 days in Japan with a high level delegation discussing all things mining and industrial.
I have a hunch that the Saudis are going to lead the Gulf States in producing green steel metallics (DRI and HBI) for re-export to Japan and others. That would let the Japanese circumvent US and EU carbon levies.
We'll see, of course, but if that's the path they are looking to go down then collectively the Gulf States will need all of Zanaga and then some.
Very exciting times.
Market News: Zanaga Iron Ore surges 20% as Congo hydro-power agreement signed.
Mark Rogers, December 28, 2023
ZANAGA SHARES HAVE NOW DOUBLED IN 2023 AS EXCITEMENT BUILDS AROUND THE PROJECT.
Zanaga Iron Ore Company
Shares in Zanaga Iron Ore Company (LSE: ZIOC) jumped over 20% on Thursday morning after the firm revealed it has penned a landmark clean energy agreement with China Machinery Engineering Corp.
The iron ore explorer, focused on the Republic of Congo, signed a memorandum of understanding with CMEC to advance engineering and funding plans for new hydroelectric facilities close to Zanaga’s namesake project.
Zanaga said CMEC will now complete further inspections and studies on the proposed hydro sites near Zanaga before drafting proposals on how the dams will be financed between Congo’s government and third parties.
The AIM-listed miner also updated investors that a feasibility study with an unnamed Chinese partner is progressing well and has already identified chances to reduce costs versus previous plans.
ZANAGA SHARES HAVE NOW DOUBLED IN 2023 AS EXCITEMENT BUILDS AROUND THE PROJECT.
https://www.investomania.co.uk/zanaga-iron-ore-surges-20-as-congo-hydro-power-agreement-signed/
Hi nibj.
I'll stick with the sells coming from Shard - largely because Clifford Elphick has said as much. This from 3rd July when the Shard facility was detailed. Clifford Elphick, Chairman of ZIOC commented:
'...This transaction (Shard) enables ZIOC to secure capital in the future as the project progresses and further milestones are achieved.'
A Hydropower MoU was one of the 4 milestones (actually scheduled for 1Q24) as was the EPC recostings (4Q23) which were also reported complete this past week.
> So 2 of the 4 milestones achieved and which CE specifically said would allow Shard to raise capital. So, unless someone has a very compelling alternative, it is Shard.
>> I've been watching the price action like a hawk (and I do have considerable experience of this) and I think Shard sold as much as 4m shares post 'CMEC' to add to the 3m of last week. If so then a hefty chunk of T2's 12m has been placed. I reckon they have raised c.$800,000 for ZIOC, either towards working capital or against the GLEN loan.
More larger, delayed trades:
667,000 from today, plus a further 380,000 and a 140,000 from yesterday.
For yesterday and today a total of 2.69m of supply in just larger blocks. Plenty more 'at market' and reported in real time. Shard working overtime.
FMF24 starts in Riyadh on 9th January to 11th.
There are only 5 trading days between now and then.
I wouldn't want to be out of this over 2 weekends and the New year.
One more 'tell' in yesterday's RNS that deserves a mention, '...third Parties.'
o Following CMEC's preliminary inspections and engineering of potential hydroelectric sites near the Zanaga Project, an MoU has been agreed between ZIOC and CMEC with the following objectives:
o Advance engineering and related studies for the identified hydroelectric sites near the Zanaga Project.
o Draft arrangements for the funding of development and operation of the identified hydroelectric project(s), between the government of the Republic of Congo and ****third Parties****.
> These will almost certainly be supra national finance institutions, think IFC (World Bank), AfDB, and the likes of Afreximbank.
It was Afreximbank who, last month, extended a $96m facility to Zanaga's near-neighbour Sapro-Mayoko, with the prescient observation about, 'rapid development of iron ore in the Congo'.
What do they know, huh?!
There were 13 delayed reports today for a total of 1,499,000 shares (c.£157,000). I'm chalking them down to Shard supply into today's positivity - (hydropower milestone achieved).
Watching the price action I think they stepped in after the early break above 11.00p and supplied stock all the way back down to 10.00p through the day. By a very rough reckoning, all in they could have supplied 3m shares today, adding to my estimate of 3m of T2 already supplied.
Recall Clifford's comments on the new facility on 3rd July: Clifford Elphick, Chairman of ZIOC commented:
'...This transaction enables ZIOC to secure capital in the future as the project progresses and further milestones are achieved.'
Well, hydropower was one of said milestones (coming here in 4Q23 ahead of the 1Q24 then projected).
Anyway, T1 of 12m is done, and I estimate 6m of T2's 12m already sold. T3 is entirely elective.
As for the Glencore loan, due tomorrow, this from 29th September just gone:
Cash balance of US$0.6m as at 30 June 2023 and cash balance of US$0.5m as at 31 August 2023.
o Current available cash on hand is expected to cover ZIOC's corporate overheads until end Q1 2024 assuming an extension of the term of the current facility from Glencore which is currently due to be repaid on 31 December 2023, with current SMC facility placement expected to extend ZIOC working capital into Q3 2024 following that extension.
> I reckon ZIOC, GLEN, and the NomAd will be quite happy with the situation so far.
The news that CMEC is looking at hydropower for Zanaga is hugely positive and a massive tell that development is nigh. There's also the kicker that hydro is 'green power', thereby helping along the whole green steel value chain.
However I think we may have missed the most important part in today's update, the part on the EPC costings:
CHINESE EPC PARTNER FS UPDATE PROGRESS
o The initial review and re-costing phase of the 2014 Feasibility Study ("2014 FS") has been completed, indicating potential cost reductions versus the 2014 FS.
o The market enquiry and financial modelling phase 2 is underway and will now be extended into Q1 2024 given the comprehensive nature of the update.
> The EPC came in as promised by the end of 4Q23, and then ZIOC have pressed quickly on, and here is an absolutely reveal:
'...MARKET ENQUIRY...IS UNDERWAY...'
>> This will be ascertaining actual demand and pricing for Zanaga product: pellet fines (66%Fe rising 68.5%Fe), cold pellet prices, and green premiums for the whole. In turn this will feed directly into both an updated NPV *AND* hence ZIOC valuations for incoming Strategic Investors.
>>> 100% they are looking to get this all done by the upcoming FMF in Riyadh this January - without a doubt.
Things were equally silent in equity updates, with Zanaga Iron Ore announcing it had signed a memorandum of understanding with China Machinery Engineering Corporation (CMEC) for hydroelectric power solutions at the Zanaga Iron Ore Project.
The firm said the agreement aimed to advance engineering studies for hydroelectric sites near the project and establish funding arrangements between the Republic of the Congo's government and third parties.
Additionally, Zanaga reported on progress of its feasibility study update with its Chinese EPC partner, indicating potential cost reductions compared to the 2014 study, with the second phase extending into the first quarter of 2024.
https://www.voxmarkets.co.uk/articles/london-pre-open-stocks-set-for-another-positive-start-feaa1a7/
Zanaga shares rise on accord for project hydroelectric power solutions
28 December 2023, 09:48
ZANAGA IRON ORE CO LTD ON THURSDAY SAID IT SIGNED AN ACCORD WITH CHINA MACHINERY ENGINEERING CORP OVER HYDROELECTRIC POWER SOLUTIONS FOR THE ZANAGA IRON ORE PROJECT.
Shares in Zanaga were up 28% to 11.20 pence each in London on Thursday morning.
The iron explorer focused on the Republic of Congo said the memorandum of understanding was agreed following CMEC’s preliminary inspections and engineering of potential hydroelectric sites near the Zanaga project.
Zanaga said the accord was agreed with the following objectives: advance engineering and related studies for the identified hydroelectric sites near the Zanaga project; and draft arrangements for the funding of development and operation of the identified hydroelectric projects, between the Republic of Congo government and third parties.
Zanaga also updated on its feasibility study with an unnamed Chinese engineering, procurement & construction partner.
The initial review and re-costing phase of the 2014 feasibility study has been completed, indicating potential cost reductions from the 2014 study.
Zanaga said the market enquiry and financial modelling phase 2 is underway and will now be extended into the first quarter of 2024 given the ‘comprehensive nature of the update’.
‘ZIOC’s feasibility study update process is progressing well and has identified a number of potential value engineering opportunities,’ said Chair Clifford Elphick.
Copyright 2023 Alliance News Ltd. All Rights Reserved.
https://www.sharesmagazine.co.uk/news/market/1703756936809170400/zanaga-shares-rise-on-accord-for-project-hydroelectric-power-solutions
C/O AD Ports in July:
Abu Dhabi, UAE – 20 July 2023: AD Ports Group (ADX: ADPORTS), the leading global facilitator of trade, logistics, and industry, and China Machinery Engineering Group Corporation (CMEC GROUP), a state-owned key enterprise directly managed by the central government of China, have recently signed a Memorandum of Understanding (MoU) to establish a strategic cooperative relationship.
> CMEC: a state-owned key enterprise directly managed by the central government of China
>> So the central government of China is proposing building hydropower for Zanaga.
We closed yesterday, Wednesday, with a break higher:
The bid was at 8.50p and we had a large late reported trade; a buy of 200,000 shares at 8.70p - the largest of the day at the high of the day.
Game on.
ZIOC have really got a shuffle on here, suggesting considerable urgency and progress behind the scenes. A Hydropower Power Partnership has been trailed as a key milestone and one due in 1Q24, so we are ahead of the game on this. As per September 23:
Hydro power partnership - Q1 2024 (Memorandum of Understanding)
CMEC ARE HUGE. Furthermore this July they signed a moU with Ad Ports to establish a Strategic Cooperative Relationship:
Abu Dhabi, UAE – 20 July 2023: AD Ports Group (ADX: ADPORTS), the leading global facilitator of trade, logistics, and industry, and China Machinery Engineering Group Corporation (CMEC GROUP), a state-owned key enterprise directly managed by the central government of China, have recently signed a Memorandum of Understanding (MoU) to establish a strategic cooperative relationship.
The MoU details the ways in which the two companies will explore potential opportunities globally, but particularly in the Middle East, Central Asia, South Asia, South East Asia, East Asia, Africa, South America, and Europe.
Under the agreement, the two parties will cooperate within various fields and sectors, including global industry and infrastructure development, financing, building, operation, and maintenance, global economic cities and free zones development, and global logistics.
https://www.adportsgroup.com/en/news-and-media/2023/07/20/ad-ports-group-and-china-machinery-engineering-group-corporation-sign-memorandum-of-understanding
> As I say this all implies considerable progress, and significant synergies, behind the scenes.
Well, that’s massive news
2 large lates just showing:
15:34:15 8.40 150,000 12.60k O
14:27:08 8.7512 200,000 17.50k O
Demand for green steel being driven by ESG, Net Zero and carbon border taxes - plus iron ore prices are surging.
Now add in premiums for high grade and cold pellets.....
Iron Ore Surges Past $140 to The Highest Since June 2022
https://www.bloomberg.com/news/articles/2023-12-26/iron-ore-surges-past-140-to-the-highest-since-june-2022
Rewind to last January at FMF23. The PIF-Ma'aden JV was formed to specifically secure globally significant sources of iron ore, necessarily Zanaga's high grade, to feed Saudi Arabia's green steel industry. To date not one shovel full has been secured...
SAUDI ARABIA HAS LAUNCHED A MINING FUND THAT PLANS TO INVEST UP TO $15BN OF CAPITAL IN OVERSEAS ASSETS according to people familiar with the details, as the country works to reduce its dependence on fossil fuels.
The venture, 51 per cent owned by Saudi state-owned miner Ma’aden, with the remainder owned by the country’s Public Investment Fund, will take non-operating minority stakes in mining projects internationally, the two companies said on Wednesday.
That will help Saudi Arabia, which is the world’s second-largest oil producer, to secure resources such as iron ore, copper, nickel and lithium for domestic mineral processing and other industrial activities like steelmaking.
The companies said that the fund’s initial capital would be $50mn and the two shareholders would provide just over $3bn “if additional funding is required”, according to a joint statement.
However, two people familiar with the fund’s plans said that Saudi Arabia has publicly downplayed the scale of the investment plans and that the $50mn represented its first year of working capital and the $3bn the amount intended for investment over the next 12 months.
Given the scale of projects in commodity markets, the fund is prepared to deploy more than $15bn of capital for investments over the coming years as suitable opportunities emerge, the people added. PIF declined to comment beyond the statement.
https://www.ft.com/content/46bf21a4-e626-4581-ad85-8b74bbd82e4e
This on FMF24, Riyadh 9-11 Jan upcoming:
MA’ADEN TO PLAY PIVOTAL ROLE IN ADDRESSING INDUSTRY CHALLENGES AT FUTURE MINERALS FORUM 2024
November 13, 2023
RIYADH, Saudi Arabia, Nov. 13, 2023 (GLOBE NEWSWIRE) -- The Future Minerals Forum (FMF) announced today that Ma’aden will return as a Founding Partner to the event for the third consecutive year. Ma’aden, the largest multi-commodity natural resources company in the Middle East, will play a central role again in discussions shaping the global minerals sector during FMF 2024 in January.
This event will focus on creating resilient and responsible mineral value chains in the resource-rich mineral super region of Africa, Western and Central Asia. FMF 2024 will convene government leaders, mining executives, investors, and other stakeholders to drive partnership and growth contributing to a sustainable sector and strengthening global minerals supply chains.
Last year at FMF Ma’aden made a series of significant announcements including a major joint venture with PIF, Manara Minerals, supporting global minerals supply chains that are critical to the energy transition. Ma’aden also announced milestone agreements with global mining leaders Ivanhoe Electric and Barrick Gold Corporation helping to drive forward the development of the Kingdom’s mining sector.
The Forum plays a key role in supporting investment and partnerships in Saudi Arabia and globally.
Exciting new initiatives that will be discussed at FMF 2024 include...creating a green metals hub within the super region by utilizing modern technologies and developing processing centers.
https://www.globenewswire.com/en/news-release/2023/11/13/2779040/0/en/Ma-aden-to-play-pivotal-role-in-addressing-industry-challenges-at-Future-Minerals-Forum-2024.html