JOHANNESBURG (miningweekly.com) – Kumba Iron Ore has agreed to transfer its Thabazimbi mine, in Limpopo, to ArcelorMittal South Africa (AMSA).
Until 2014, the mine was a captive mine owned and run by Kumba subsidiary Sishen Iron Ore Company (SIOC), but was funded by and supplied ore exclusively to AMSA. AMSA is, therefore, responsible for 96% of the mine’s rehabilitation liability, while SIOC is responsible for the site’s management and the remainder of the liability.
The transfer of the mine to AMSA will simplify the arrangement, with AMSA to be solely responsible for the closure and rehabilitation of the mine.
Mining operations at Thabazimbi ceased in September 2016 and the identified assets and liabilities of the mine will be sold to AMSA for R1, plus the assumed liabilities.
“In line with our strategy to manage our costs more efficiently in what is a particularly difficult time for the local steel industry, this agreement allows us to take full management control of the processes and costs related to the rehabilitation liability at the Thabazimbi mine,” said AMSA CEO Wim De Klerk.
He added that AMSA would also investigate the possible restart of operations to supplement the steel producer’s iron-ore sources.
The transfer is dependent on competition authority approval, cession of the Thabazimbi mining rights in terms of Section 11 of the Mineral and Petroleum Resources Development Act and a satisfactory due diligence investigation by AMSA.
If these conditions are not satisfied by April 28, the agreement will lapse and SIOC will proceed with the closure of the mine.