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Johannesburg, 1 September 2008
Six million tonne expansion at Khumani set to proceed
Start-up capital of R1.2 billion approved
Assmang Limited, which is jointly held by African Rainbow Minerals (ARM) and Assore Limited, is pleased to announce that approval has been received for the start-up capital programme for the additional 6 million tonne expansion project at the Khumani Iron Ore Mine in the Northern Cape Province. This follows the successful completion of the Khumani mine expansion pre-feasibility study that shows significant value, given conservative iron ore pricing assumptions.
A feasibility study on the project is expected to be completed in the second quarter of the 2009 calendar year and, pending a positive outcome, final approvals will be sought from the respective boards for the official commencement of the expansion. Should the expansion proceed, this will mean that Khumani mine will increase its capacity from the current level of 10 million tonnes per annum to 16 millions tones per annum.
Total capital expenditure for the expansion is estimated at R7.3 billion. Approval of the initial capital (R1.2 billion) will enable the mine to order long-lead items, which will in turn assist in the rapid construction of the project.
Of the 6 million tonnes expansion, 4 million tonnes will be for the export market and 2 million tonnes for the domestic market. Assmang has received a commitment from Transnet to extend the current Iron Ore Export allocation from 10 mtpa to 14 mtpa, increasing Assmang?s export capacity accordingly. This will dovetail with the Iron Ore channel expansion from 47 mtpa to 60 mtpa.
For more information please contact:
Jan Steenkamp or Monique Swartz
Chief Executive: ARM Ferrous Corporate Development and Head of Investor Relations
Office: +27 11 779 1108 Office: +27 11 779 1507
Mobile: +27(0) 82 492 6948 Mobile: +27(0)83 411 2881
jan.steenkamp@arm.co.za monique.swartz@arm.co.za |