JOHANNESBURG (miningweekly.com) – Iron-ore developer Sundance Resources has signed a binding memorandum of understanding (MoU) with private Chinese company Tidfore Heavy Equipment Group and Cam Iron – a subsidiary of Sundance that has a mining permit application over the previous EP92 in Cameroon.

The MoU will provide a framework for cooperation between the parties and their joint venture partners to establish the required consortium of expertise to fund, or assist in sourcing the funding, the construction and infrastructure of Sundance’s flagship Mbalam-Nabeba iron-ore project, which straddles the border of Cameroon and the Republic of Congo.

Under the MoU, Sundance will sell 51% of its ownership in Cam Iron to Tidfore for a value to be agreed or independently valued, once Cam Iron obtains title to the tenure over the area covered by the previous EP92 for a minimum of three years.

Currently, Cam Iron has a mining permit application lodged over this area. The company reached an agreement with the government of Cameroon last year to initially extend the Mbalam convention by six months to January 26, with a further six-month extension being available if Sundance could show substantial progress on funding the project either by itself or with a credible partner.

Sundance and Tidfore met last week with representatives of the government in Cameroon to outline their proposal for the development of the project, with the government yet to determine whether it will grant Sundance the further extension of the convention.

“Sundance is pleased to have reached an agreement with substantial parties to progress the development of the project and now awaits the decision of the government of Cameroon on whether it will grant a further extension.

“Even though there is still substantial work required to obtain the funding required, the high-quality, low costs and large quantity of the iron-ore fits well into the needs of the future of the Chinese steel industry. Together with our current partners we have the basics required to bring this project into production,” Sundance CEO and MD Giulio Casello said.

Sundance was up 75% on traded volume of over 72-million shares on the ASX, fetching A$0.007 a share.