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A series of confirmations here that China must inevitably and imminently make their pitch for Zanaga:
CHINA’S BIG MOVE TO CUT OFF AUSTRALIAN IRON ORE
Beijing is spending big in order to “de-risk” itself from Australia in a move that could cripple Aussies.
It’s remote. It’s inaccessible. It’s poor quality. But Beijing is determined to spend big on a Sahara Desert mine to “de-risk” itself from Australian iron ore.
China Railway Construction Corp Ltd (CRCC) is one of the world’s biggest construction and engineering groups. It’s controlled by the Chinese Communist Party’s State-owned Assets Supervision and Administration Commission of the State Council.
Now it’s laying 6000 (sic) kilometres of new railway line across the North African Algerian desert.
It’s all about giving the Beijing-owned steel conglomerate Baowu control of the Gâra-Djebilet mine.
https://www.news.com.au/finance/business/mining/chinas-big-move-to-cut-off-australian-iron-ore/news-story/50eae131e0b7e6cb71966210dc78de68
1. No matter that the Algerian mine is poor quality (v. high phosphorous content) and remote (600km++ of rail needed), and part straddles a long running conflict zone, Beijing want the ore.
2. Any Algerian port is going to be a further 1,000km+ to ship to China than Simanadou in Guinea, itself a further 1,500km+ further than Pointe Noire for Zanaga.
3. Baiwu Steel - the world's no.1 steel producer leading China's Simandou involvement.
4. The involvement of SASAC, the all-important and powerful Supervision and Administration Commission of the State Council. SASAC is directly controlled by the CCP and directs strategic investments in ket resources amongst other roles.
> By my research, SASAC are very likely to be where our Chinese EPC's 'near-final' report into Zanaga is currently being approved. More on this as and when time allows later today.
Really? Oh. Moving on..
Let's think about this intelligently for a moment.
The US are after a NY flat that was bought in 2014 from alleged 2013 misdeeds and which since has never been occupied. I doubt Big D and his daughter give a stuff, frankly. If anything it will push them further into the BRICS++ camp. China have extended an invitation for President Nguesso to pay an official visit to Beijing this August and, as chronicled here, the week before last Sheik Maktoum proposed a State Visit to Dubai for President Nguesso at some point. The invite was made by the UAE minister for cooperation who had previously dealt with little d over AD Ports and who again reinforced the opportunities of infrastructure investment by the Emirates. This in Dubai where Big D and Co keep a number of properties. So, as I say, I doubt Big D gives a stuff.
The sideshow has got nothing to do with Glencore at all. They've positioned themselves as a minority shareholder in a resource project which is very likely to be sold to and developed by 3rd Parties, leaving Glencore with no direct dealings with Brazzaville.
The world has turned.
HOW GULF STATES ARE PUTTING THEIR MONEY INTO MINING
With Gulf nations raking in $400bn of fossil fuel revenues annually, but facing a future where hydrocarbons will be phased out, expanding into mining is a logical step. At the same time, Saudi Arabia and the UAE are investing heavily in new technologies and will need access to their own steady supply of raw materials.
“The Middle East is looking to diversify and has a war chest,” says Richard Blunt, partner at Baker McKenzie, the law firm that represented Zambia on the IRH deal. “They’ve got this massive advantage as they can do government-to-government deals and have patient capital yet come without the diplomatic pinch involved in choosing between Chinese and western investors.”
Under Crown Prince Mohammed bin Salman’s “Vision 2030” to modernise Saudi Arabia’s economy, mining and minerals processing are earmarked to become the third industrial “pillar” next to oil and gas and petrochemicals. “Nation building” is the main driver behind Saudi’s push, says Tim Keating, a former head of mining for the Oman Investment Authority.
> Then this on ports. ADP not mentioned but you get the drift:
The emirate of Dubai, a key precious metals trading hub, already has a large foothold in Africa’s ports and logistics network, the fortunes of which are closely tied to commodities. Dubai government-owned DP World has won port concessions in DRC and most recently Tanzania’s Dar es Salaam, a crucial shipping juncture for copper from Zimbabwe and Zambia.
“The majority of these resources are landlocked. There’s a huge opportunity to reduce the cost of the supply chain,” says Mohammed Akoojee, head of sub-Saharan Africa at DP World, which hopes to double the capacity of its terminals business in the next three to five years, including expanding bulk shipping.
https://www.chinastrategy.org/2024/04/01/how-gulf-states-are-putting-their-money-into-mining/
You cannot value Zanaga as a whole until the full extent of the Resource/Reserve is known.
$200m+ is loose change given that 30mtpa is $3.5bn++ every year.
If increasing the JORC Reserve trebles that RoM then ZIOC’s BoD will surely insist on further drilling as part of any investment package.
...and they are prepared to fund the necessary infrastructure
HOW NORTH AFRICAN RAILWAY IS ON TRACK TO HELPING CHINA DE-RISK ITS IRON ORE SUPPLY
Algeria’s Gara Djebilet iron ore mine has reserves of 3.5 billion tonnes that could help China de-risk its supplies of the steel raw material
Chinese state-owned CRCC is helping to build a vital railway to connect the mine to the Algerian national rail network
https://www.scmp.com/news/china/diplomacy/article/3257816/how-north-african-railway-track-helping-china-de-risk-its-iron-ore-supply
Hi V10 - I think that the FS update and the port are all but finalised, perhaps waiting on a ZIOC Board meeting before being signed off and released.
The Strategic Partner news is dependent on this; the size of Zanaga.
I think the Strategic Partner will sign an MoU to show their intent to earn in to and then finance the project at some stipulated time in the future. For our purposes the all important investment valuation will hinge on one factor - the ultimate size of Zanaga. To date the NPV is calculated on the proven reserve sufficient to deliver the staged 12-30mtpa project out to 30 years of production.
However that staged project is predicated on a small fraction of what could be at Zanaga. The ultimate Reserve could be 5, 8 or even 10 times the current JORC. So....I think the Strategic Partner MoU will include the central stipulation that the Partner will fund an extended drill campaign to prove up even more of the Resource into the Reserve category.
This means that we will have to be patient for our eventual jackpot. I have numbers for that eventuality. However and in the meantime an outline of their intentions could and should be worth an immediate SP of £3+.
More detail from last week's Dubai meeting between President Nguesso and the Emirati minister for International Cooperation. Front page and P.16 of today's 'Dispatches from Brazzaville' newspaper.
The Dubai Minister extended an official invitation from the Emir to Big D, having talked of direct Emirati investment into C-B and the establishment of direct flights by Fly Emirates.
https://www.lesdepechesdebrazzaville.fr/flex/php/simple_document.php?doc=20240409_DBZ_DBZ_ALL.pdf
Some more here on twitter:
Présidence de la République du Congo - Officiel @PR_Congo
L’ ouverture d’une ligne aérienne directe Dubaï -Brazzaville par la compagnie Fly Emirates est à l’étude. Cette annonce a été faite par les autorités émiraties au Président @SassouNGuesso_lors de son court séjour à Dubaï après sa visite officielle à Bakou.
https://twitter.com/PR_Congo/status/1777709278620512711
A report today from Bloomberg that 'Simandou' funding has been signed, having received approval by 'Chinese regulators'.
'...The signing occurred on April 2 after approvals came from the country’s transitional parliament and Chinese regulators, Guinea’s presidency said in a statement on X.'
https://www.bloomberg.com/news/articles/2024-04-09/guinea-partners-get-15-billion-funds-for-top-iron-ore-deposit
Correlates with my post in here (above in thread), from 4th April, that the 'near-final' report of our Chinese EPC is likely waiting on official, Beijing approval - and hence the March tour of Chinese projects in Congo by the Chinese Ambassador.
Given the above, has the EPC report also been approved by Chinese regulators? Are Zanaga investment and development now at the country-to-country level? Does this explain the radio silence from the ZIOC BoD, Marty and Trahar? I reckon so.
> News slated for within the next 3 weeks.....
FWIW I don't think our new CEO Marty will be making official comment until news flow is released. The reason being is that next developments (FS, port and Strategic Partner/s) are likely dependent on Government-level events, for example the ratification of the CB-UAE CEPA trade deal to free up any AD Ports deal on a mineral port.
However...Marty has been active on LinkedIn and his 'likes' are a checklist of people and companies that together indicate much activity behind the scenes on a corporate level. Marty has liked:
Manara Minerals,
Saudi Arabia's Deputy Minister of Industry and Mineral Resources for Mining Affairs, Eng. Khalid Al-Mudaifer who was CEO of Ma'aden and is now on the BoD of Manara Minerals,
AD Ports several times, plus
Green steel financiers and institutions.
There're also these, which are very specific to mine development:
AMC Consultants - Strategy optimisation for miners (think EPP perhaps),
International Facility Services - mining camp facilities and management across Africa,
Stanton Chase, executive search with expertise in Natural Resources, Mining and Energy, and
Steyn Reddy Associates - Global Leaders in Land Access & Resettlement
https://www.maaden.com.sa/en/about/bod
https://www.amcconsultants.com/just-how-optimal-is-optimal
https://www.ifsafrica.com/
https://www.stantonchase.com/expertise
https://steynreddy.com/
> All of which give an insight into ZIOC's work streams, thinking and planning.
Reading between the lines of our last RNS, the port discussions are well advanced - (see RNS below). Better still is news from last week that Big D met with the UAE minister in Dubai and who again plugged UAE infrastructure in the Congo...
RNS, 28th March 2024:
PORT MOU: Significant progress has been made in securing interest from large scale port development companies interested in participating in the development of port infrastructure for the Zanaga Project. In parallel with the 2014 FS update process, these discussions are progressing.
>Significant progress, companies plural, and does 'parallel with FS update' mean the end of this month as well as the FS?
UAE MINISTER REEM AL HASHIMY
On twitter there was a tweet yesterday (1) that detailed a meeting last week in Dubai between Bid D and the Emirati Minister i/c of their infrastructure projects in the Congo. Last October (2) the same minister, Reem Al Hashimy, met with little d when they specifically discussed AD Ports, and in which little d requested the UAE to guarantee its success:
(1)
H.E. Denis Sassou Nguesso, PR of Congo, met on 06/04 with a delegation from Expo City Dubai Authority, led by its CEO, H.E. Reem Al Hashimy, Minister of Coop. of the UAE. The meeting focused on the common desire to carry out infrastructure projects in Congo.
https://twitter.com/Boukary2016/status/1776731085994328535
(2)
This October 6, at #Dubai Expo City, Minister Denis @ChristelSassou Nguesso had a working meeting with HE Reem Ebrahim Al Hashimy, UAE Minister of State in charge of #Coopération International....The two ministers also discussed the ongoing collaboration between Congo and @ADPortsGroup regarding the construction project of a state-of-the-art multipurpose terminal within the autonomous port of Pointe-Noire. After reviewing the progress of the said project, Minister Denis @ChristelSassou Nguesso requested support from the UAE government to guarantee its success.
https://twitter.com/CooperationCG/status/1710358575908786349
>> Did the UAE minister last week plug AD Ports with Big D? The evidence suggests she did.
Mitch, your 'probably already had a big influence in AD Ports involvement' - is itself pure speculation! There is no evidence whatsoever that ADP and KP2 have any relationship, let alone KP2 influencing anything. None. Pure speculation. Besides, there isn't any mineral port that can have been influenced! AD Ports have signed a MoU to build a new mole down at PAPN. As far as we know this hasn't commenced nor any customers been revealed. None. So your comments are fantasy.
Yet you label as 'pure speculation' anything other than Chinese involvement at Zanaga. Well, that is errant nonsense as well. Trahar revealed that FMG were interested some years back, and now ZIOC reveal that they have Strategic Partners interested - that's PLURAL. So entities other than the Chinese. Thus everything else cannot be just 'pure speculation'. You are way out there, by logic and in the company's own words.
There's Manara Minerals, for one. They are specifically tasked to secure iron ore for the Saudi green steel industry, where only iron ore of Zanaga's grades will suffice. It is ABSOLUTELY INCONCEIVABLE that Bob Wilt, the PIF or Ma'aden don't know of Zanaga or have it on their radar. Zanaga exactly fits the requirements of what is a strategic industry for them - large, high grade, shovel ready and not owned by one of the mayors. Their interest would never be confirmed by ZIOC, but that doesn't relegate it to speculation. No rationale observer would conclude that for a moment.
Back on KP2, it has fallen by 95%+ since their 2018 IPO and has a further 20% to reach the 0.38p level of the March CLN fund raise. We all know that many accounts jumped out of ZIOC and into KP2 (and KRPZ) when the AD Ports MoU was signed - on the principle that a rising tide floats all boats. This was enthusiastically touted on ZIOC's bb. I was able to watch the paired trades go through as well - sells on ZIOC and buys for the equivalent on KP2. It was tragic-comic to then read the ZIOC posters then turning up on KP2 - then and now. It's now obvious that the rising tide didn't float all boats, and those rainbow chasers are sitting on capital losses. That doesn't excuse making false equivalences now between ZIOC and KP2. One is the organ grinder, the other the monkey - one with 4.12bn shares in issue already and inevitably more to come. Look out below.
That is a very weak analogy Mitch984.
The development of the green steel industries in the ME, the ensuing demand for high grade iron ore and the establishment of highly capitalised entities to secure such ore is *HIGHLY RELEVANT* to Zanaga, as could well be the supply response of Vale, the world's 2nd largest supplier of seaborne iron ore, who missed out on Simandou and yet still have 'African' ambitions. What's more the story of high grade demand from such companies has been recognised by Zanaga's BoD and executives, new and old. Analysis of this major market trend is integral to the ZIOC investment proposition.
I much prefer this to the mediocre tedium and insipid growth pangs of mid-tier (potentially) fertiliser mine whose project cannot stand alone and has to piggy back off world class propositions to secure infrastructure.
So I prefer the 'latter' over KP2's 'real news' (barely contained derision), Eddsy is quite right.
She was doing due diligence on in country and on the ground business conditions. 100%, and 100% that her findings feed through into the Chinese EPC engagement at Zanaga.
I think you are onto something there, nibj.
For example the new, improved FS plus Chinese EPC inclusion would all be great - BUT would remain theoretical unless the port had also been agreed, and hence the project unstranded. On the milestones the port MoU was scheduled ahead of any MoU on Strategic Partner/s. Perhaps that's what we are all to expect?
Whatever the case (port MoU, senior Chinese approval etc) the positive is that the Company have committed to this month for the update. Fingers crossed.
Deciphering Thursday's RNS. Answers on a postcard..
ZIOC have completed the review and recosting of the BF yet the whole process is described as 'nearing completion' because of a 'near-final report' from the Chinese EPC.
So what's a 'near-final' report? What are they waiting on? Why is whatever they are waiting on critical to the final report? Is it external to both ZIOC and the EPC? Does this imply that the Chinese EPC are central to development, and hence that development is being readied? Does this imply approval from a higher (Chinese) entity to the Chinese EPC? Is it State/CCP sanction for development and investment? (As per Baosteel at Simandou).
>The answer is 'key to further engagement of strategic partners'. So whatever is the final box tick for the Chinese EPC is key for Strategic Partners.
Why is it 'key'? Must it be more than just a reworked FS of 2014? The numbers are in, so is it a practical or political consideration/deliberation? Are the discussions external to ZIOC and even the Congo?
Any day now:
ZIOC, 'The final results of the 2014 FS update are expected to be announced during April 2024.'
If the final 'key' is external to ZIOC, and also at a higher level, then ZIOC must have received strong assurances by last week that answers will be given imminently, and in time for any announcement of the final FS report this month.
KP2 have also appointed a CEO today. Another one in anticipation of port news? We’ll see…
The Nov 22 Marketing Agreement can be rewritten if 50%+1 share of MPD changes hands. IMO that is a dead cert if Baowu get involved. They'd want every last ton they could get their hands on. That being the case then any Manaraa Minerals - Glencore surplus off take issue would likely disappear...
(m) If there is a direct or indirect change in ownership of MPD amounting to 50% + 1 share or more of the issued share capital of the relevant target entity, and, following such change in ownership, MPD notifies Glencore International in accordance with the terms of the Marketing Agreement that it wishes to cancel the Marketing Agreement and enter into a new life-of-mine marketing agreement (a "New Marketing Agreement") in respect of 100% of the production of the Mine with the relevant investor or its Affiliate (a "New Buyer"), then Glencore International may notify MPD, subject to the terms and requirements of the Marketing Agreement, that either:
(i) it shall match the terms of the New Marketing Agreement, in which event the parties shall discuss and agree in good faith such minimum amendments required to the Marketing Agreement to align with the key commercial terms agreed between MPD and the New Buyer under the New Marketing Agreement; or
(ii) it agrees to the termination of the Marketing Agreement, in which event the Marketing Agreement shall be terminated upon execution by MPD of the New Marketing Agreement and thereafter Glencore International shall be entitled, for the term of the New Marketing Agreement and / or any replacement or supplement to such agreement, to receive a fee in each calendar month by way of consideration for the initial marketing role played by Glencore International under the Marketing Agreement ("Royalty"), and
the Marketing Agreement shall be terminated only upon execution of the Royalty by Glencore International and MPD in a form acceptable to Glencore International acting reasonably.
If Glencore International fails to provide a response to MPD in accordance with the requirements of the Marketing Agreement, it shall be deemed to have accepted the termination of the Marketing Agreement, in which event the terms of paragraph (m)(ii) above shall apply.
There's nothing that precludes both Saudi Arabia *and* China from both being Strategic Investors in Zanaga. In fact this news from last May suggests they could well be part of a consortium. Baosteel, Saudi Arabia and PIF....
CHINA'S BAOSTEEL, SAUDI ARAMCO AND PUBLIC INVESTMENT FUND SET UP VENTURE TO BUILD STEEL PLANT IN SAUDI ARAMCO
By Reuters
May 1, 2023
...Baosteel will take 50% stake in the joint venture, while Saudi Aramco and PIF will take 25% stake each, Baosteel said in a statement.
https://www.reuters.com/markets/deals/chinas-baosteel-saudi-aramco-pif-set-up-jv-build-steel-plant-saudi-aramco-2023-05-01/
Intriguingly the legal name of the company that Baowu incorporated for Simandou is 'Baowu Resources West Africa Company (Baowu Guinea)'.
West Africa...