Shandong Iron & Steel Group recently said it will pay US$1.5Bfor a 25% stake in African Minerals’ iron ore project in Sierra Leone to bolster raw material supplies
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London-listed African Minerals announced Tuesday that it has sealed a 2nd investment deal with Shandong Steel, China’s 5th largest steel mill by output, for the Tonkolili project in Sierra Leone. Under the deal Shandong will also buy 10M tonnes of iron ore every year at discounted prices.

“The strategic investment will help us accelerate the development of Tonkolili,” Frank Timis, executive chairman of African Minerals, said in a statement.

African Minerals already has a tie up with China Railway Material (CRM) and is expected to deliver 8M tonnes of iron ore next year. It secured a deal in April to sell CRM a 12.5% stake for US$280M to help fund the 1st stage of the Tonkolili project, as well as an off take agreement for future iron ore output.

The deal with Shandong will also help the company fund the Tonkolili capacity expansion to 10M tonnes a year from 8M tonnes.

Mr. Timis said in June that African Minerals was in talks with several Chinese companies to raise US$5B for expanding its annual capacity to 45M tonnes.—Paul A. Ebeling, Jnr. www.livetradingnews.com

Posted by Shayne Heffernan on Jul 14th, 2010and filed underBRIC, Equities, Europe, Latest News, Markets, News & Events.You can follow any responses to this entry through theRSS 2.0You can leave a response by filling following comment form or trackback to this entry from your site