London Mining secures 1 million tpy iron ore offtake deal with Cargill
Sierra Leone-focused iron ore miner London Mining has secured a 1 million tpy iron ore offtake deal with international trading house Cargill.
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The deal will last for five years and does not entail any marketing fees, the miner said in a results statement on Thursday March 6.
Cargill will pay a $20 million offtake-related prepayment to London Mining as part of the deal, the miner said.
Cargill is the third major international trading house to set up an offtake deal with London Mining, which started production at its Marampa iron ore mine in Sierra Leone in late 2011.
Swiss commodity giant Glencore signed a 9.5 million tonnes iron ore offtake agreement with London Mining in January 2011, and a further offtake agreement with Vitol was signed in March 2012.
Sierra Leone became the sixth-largest exporter of iron ore to China in January 2014, exporting higher levels of the steelmaking raw material to the world’s top consumer than Canada, Ukraine , India and Chile.
London Mining saw full year 2013 production of iron ore at Marampa total 3.4 million wet tonnes, with full year sales increasing to 3.7 million wet tonnes.
A new mid-tier of mining activity has emerged in Africa, with smaller mining companies filling the gaps where mining majors have scaled back on their investments on the continent.