JOHANNESBURG (miningweekly.com) – The iron-ore market would continue to be a “very good” market to be in over the short-to-medium term, as prices would remain “extremely strong”, London Mining CEO Graeme Hossie said on Monday.

He told Mining Weekly Online in a telephonic interview that this boded well for London Mining, which was bringing its first iron-ore project into production, as it would be able to take advantage of these good market conditions.

London Mining last week officially launched its flagship Marampa iron-ore mine, in Sierra Leone, which would be ramping up to 1,5-million tons a year of iron-ore within the next 12 months.

Hossie explained that the Marampa mine, which was shut down about 35 years ago, had once been a great source of wealth for Sierra Leone.

However, after years of civil war in the country, the mine had been destroyed.

The rebuilding of the mine and last week’s official launch was a “transformational event” in Sierra Leone, noted Hossie.

He explained that London Mining was fully funded and was able to bring the mine into production by investing $80-million on the mine in the coming 12 months.

This would bring enormous investment into the country, which had earned a total of $5-million from the mining industry in 2008.

Investment was also being made in infrastructure in the country.

Hossie noted that the building of roads surrounding the mine was about 80% completed, while a new port was also being built.

Output from tailings at the project would ramp up to three-million tons a year within 12 months after the initial 1,5-million tons a year output is reached.

However, London Mining continued to look into further developing the primary ore at the mine to boost production to between five-million tons a year and eight-million tons a year by about 2013.

This would be a massive expansion when compared with the two-million tons a year it had produced before closing down.

The project would also benefit locals through employment, noted Hossie, saying that the vast majority of workers to be employed by the mine would be locals.

London Mining would also focus on skills transfers and the training of locals over the 40-year to 50-year life-of-mine of the project.

Meanwhile, Hossie noted that iron-ore from the project would likely be sold to European and Chinese steelmakers, as these were the ideal markets for its 66% iron sinter feed concentrate.

The iron-ore miner was building strong relationships with Chinese steelmakers and government entities and expected a lot of its product to be sold to this Asian market.

BEYOND MARAMPA

Meanwhile, London Mining also had three other key iron-ore projects, one which was already operating and another two that would start production within the next five years.

A joint-venture (JV) project in Saudi Arabia was expected to start production in late 2013, while output at its Isua project, in Greenland, was likely to start in 2014.

Further, London Mining had a 50:50 JV project in China, which currently produced about 400 000 t/y of product.

While this was a small mine, there was potential to expand the project by consolidating other adjacent mines and projects, noted Hossie.

London Mining was currently looking at enlarging this project, he said.