Earthstone Acquires Zambia Manganese Concessions

Manganese Exploration To Begin In Luapula Province

Dubai-based Earthstone Metals Group, has acquired exclusive irrevocable mining rights for three manganese concessions in Zambia’s Luapula province.

Although South Africa is well-known for its manganese export, Earthstone feels that Zambia still has untapped opportunity in development of the mineral.

The new concessions are located within 60 km radius from Mansa Town, capital of Luapula province. Total combined area of the project exceeds 140,000 Hectares.

The grade of the ore is high (48 to 54% Mn) and the bulk of the ore consists of predominantly Psilomelane (MnO2) with occasional residual crystals of Hausmannite (Mn3O4) and Manganite (Mn2O3H2O). Earthstone has chalked out ambitious exploration program for conducting Geophysical Survey followed by shallow diamond drilling. Based upon the available exploration data, the company will commence semi-mechanized mining operation by April 2010 with a production target of 10,000 Tons/month that will be enhanced to 30,000 tons a month after 5-6 months. With further acquisitions of Manganese Ore concessions and the completion of detailed exploration work, production will ramp up to 1,000,000 tons a year within three years.

Commenting on the development, Raju Lalchandani, Managing Director, Earthstone Resources (Zambia) Ltd. said: "We find Zambia as an exceptionally investor-friendly country. Dollarisation of economy is a very intelligent scheme that is being promoted by the Government - and this is radically changing investor climate."

ENRC In $300 Million Zambian Takeover

Kazakh miner ENRC has paid $300 million to buy Dutch company Enya Holdings. Enya has a 9-% stake in the Chambishi copper and cobalt processing plant in Zambia. ENRC said in a statement on Thursday it hoped to cut costs by using the Chambishi plant in Zambia to process copper and cobalt produced in the Democratic Republic of Congo from a mine which the company bought last year.

The deal is being financed entirely from the company’s own cash resources.

"The acquisition of Chambishi accelerates the group's expansion in copper and cobalt and at a lower cost than would be required for new investment," said Mehmet Dalman, independent non-executive director. "The integrated copper and cobalt mining and smelting businesses of Chambishi and those in the DRC, when combined, should have an improved cost position over time."

ENRC plans to invest $80 million in Chambishi by 2011 to upgrade its facilities, which will boost annual capacity to 55,000 tonnes of copper cathode, more than twice its current level of 25,000 tonnes. The combined operation is expected to produce 130,000 tonnes of copper cathode a year and 12,000 tonnes of cobalt-contained metal salts and concentrates by 2012. The company said that building Chambishi’s facilities from scratch would take at least three years and would have cost more than it is paying for Enya.

Enya also owns 100% of Comit Resources FZE, a Dubai-based marketing and sales company that handles Chambishi's copper and cobalt sales.

Last September, ENRC bought Central African Mining and Exploration in a $955 million cash deal which diversified the firm into metals such as copper and into high-risk areas of Africa.

Dubai Steel Prices To Fall 10 To 15 Percent

Leaders at the Dubai Chamber of Trade & Industry have predicted that steel prices in Dubai are projected to decline by 10 to 15%, below their range at the end of 2008 of AED 2,000 to AED 2,200 per tonne.

The projections are attributed to sufficient inventories of steel and cheaper prices of petroleum derivatives required for steel production. Any possible increase in steel prices is ruled out unless oil prices witness a tangible increase on the world markets, which is not expected in the immediate future.

That was affirmed by Mr Sameh Hassan CEO of Madar Group indicating that prices of Chinese steel now range from AED 1,850 to AED 2,050 per tonne.

Source: Steel Guru/Al Alam Al Yom