Angola: Iron strengthens national economy

angola mine iron

The iron ore mining in the deposit of Cassinga in Jamba municipality, southern Huíla province, Angola, will probably be resumed within a year.

This was recently announced to the Angolan Press Agency (Angop) by the Chairman of the Board of Directors of the Angolan Iron Company (Ferrangol), Diamantino Pedro Azevedo.
Launched at a time that Angola is looking for serious alternatives to oil, the news confirms that even if the economic diversification in Angola does not entail many sectors, it is gaining consistence and enables to face the future with optimism, as regard to the mining field.

Chairman of the Board of Directors of the Angolan Iron Company (Ferrangol), Diamantino Pedro Azevedo
Chairman of the Board of Directors of the Angolan Iron Company (Ferrangol), Diamantino Pedro Azevedo

Diamantino Azevedo, a mining engineer and the right person for the job he has been doing for a long time, said so to Angop a day after the Economic and Real Economy commissions of the Cabinet Council considered and recommended for the approval of the Restructuring Plan of the Cassinga Mining-Metallurgical Project (PMSC) in Jamba municipality, Huíla province.

As soon as the PMSC is finally adopted, which will include the signing of the respective Presidential Decree, the next step will be the creation of a new company, which will replace the former Angola Exploration Mining Resources (AEMR).

Ferrangol, whose core business includes ores of iron, non-ferrous, precious and rare earth metals, will subscribe for the capital stock of the new mining company, alongside the private operators in a typical example of public-private partnerships encouraged by the Angolan State.

The resumption of iron ore mining in Cassinga results from a series of actions that have been developed as from 2010, during the approval of the mining development programme of Cassinga, in Huíla province, and Cassala-Quitungo, in Cuanza Norte province.

The programme was developed until 2013, during its review, a process that contributed negatively to the extinction of Angola Exploration Mining Resources (AEMR), the former consortium responsible for drilling operations, then subsidized by the government through Ferrangol, in partnership with private companies.

Mining prospecting area in Chipindo municipality (Huíla)
Mining prospecting area in Chipindo municipality (Huíla)

Between 2013 and 2015, the programme was revised. The process culminated in the adoption in December last year of a new model for its conducting, whose main point was the split of Cassinga and Cassala-Quitungo.

In light of this split, according Diamantino Azevedo, three mining projects, such as iron, manganese and gold projects, will be developed in Cassala-Quitungo.

Cassinga Programme with three goals

The manager states that the Restructuring Programme of the Cassinga Mining-Metallurgical Project has three short, medium and long-term goals.

The beginning of the iron ore mining within a year is deemed as short-term goal. Some constraints related to Moçâmedes Railways (CFM) and the Saco-Mar ore carrier terminal in Namibe city must be overcome.

The flow of the product to the port of export is a very important component as the ore mining and processing.

Regarding these constraints, some steps have already been taken, such as the acquisition of equipment for the export terminal.

The material, according to Diamantino Azevedo, is just waiting for its transportation to the country. Similarly, it has already been acquired the equipment for assembling the ore itself.

Concerning the figures, for the first phase, Azevedo Diamantino foresees an annual volume of 1.8 million tons of iron concentrate to be mined in Cassinga.

Maintaining or increasing this level will depend heavily on the behaviour of the product prices in the international market.

The expected mining volume is too little, compared to 5.5 billion tons in 1974, a year that recorded the peak in the history of the industry.

The reference price of a ton of ore with 62 percent of iron, placed in a Chinese port, in the modality CIF (cost, tax and shipping) is quoted currently at 62 US dollars.

The ore is qualified as from its iron percentage. Thus, up to 35 percent, the quality is low, though it may be marketed as long as it is subjected to an appropriate and more demanding handling. With 40 percent, the product is considered medium quality, while it is good when ranging to 62 percent.

Regarding the prices today in the international market of iron, Angola can reap every year just over USD 111 million in gross revenue in the first phase, in the event that the forecasts of the production rate are materialized.

It would be a good start, even if the international market of iron and steel is “very competitive”, said the Chairman of the Board of Directors of Ferrangol, Diamantino Azevedo.

Besides the simple money, the first phase of relaunching the iron ore mining in Cassinga is expected to create 800 direct jobs, as well as other indirect jobs through businesses that support the activity or improve the communities under the corporate responsibility of the project.

It is highlighted that the production itself does not generate many jobs, provided that it is based on expertise and the use of industrial machinery.

Yet, it is the positive participation in this segment of the national economy on employment and livelihoods of the Angolan communities in the country.

For the medium-term phase, it is expected for Cateruca deposit also in Jamba to start operating with a potential of proved reserves of 400 million tons of iron ore.

This deposit still needs further studies. There is already a pre-feasibility study, which will culminate in another feasibility study, within two to three years.

The projections of the iron ore mining envisage an annual volume of 10 million tons of pellets, processed ore that is presented in the form of small balls, which makes it easily handled at the packaging time so as to be exported.

For the long-term phase, it is expected for other primary and secondary mineral deposits that abound in Jamba area to start operating.

Prospecting extended to other areas

The prospecting works and geological surveys in search of iron ore, not limited to the Jamba municipality in Huíla. They were extended to Cassala-Quitungo, in Cuanza Norte, where there are resources estimated at 270 million tons.

In Cutato commune, Cuchi municipality, Cuando Cubango province, it is to start the production of pig iron, an intermediate product between the iron and steel resulting from the processing of the iron.

In this locality, the Mining-Metallurgical Project of Cuchi will be implemented, under the responsibility of Cuchi Metallurgical Company.

It is also scheduled the immediate start of production of pig iron, an initial estimated volume of eight thousand tons until the end of this year to reach 96,000 in 2017. The project is expected to start with 1,713 Angolan workers and 30 foreigners.

Construction camping in the prospecting area of Chipindo
Construction camping in the prospecting area of Chipindo

Geoangol strengthens action of mining activity

The list of all the activity already developed so far focuses on the emergence in December last year of the public-private Angolan company GeoAngol.

A firm that resulted from an idea matured in 2006, greatly strengthened the mining activities in Angola, according to the Chairman of the Board of Directors of Ferrangol, Diamantino Pedro Azevedo.

Subsidized at 40 percent by the state-owned company of Ferrangol, GeoAngol is a laboratory and geological survey services providing company.

It is installed in the Industrial Park of Viana in Luanda and represented an investment of 13 million dollars.

Its establishment at the domestic market meant a giant step, provided that some of the analysis previously ordered abroad, at high costs, are now carried out in the country, at the most reasonable cost, stressed the manager.

Saco-Mar Ore Carrier Terminal

The Saco-Mar Ore Carrier Terminal is a key element for the export of iron and its by-products produced in the Jamba area in Huíla province.

Infrastructure of support for the mining project of Cassinga, the terminal allowed the country, before independence, to export annually over three million tons of iron out of the mines of Jamba municipality.

Currently inoperative, the infrastructure must be given to Ferrangol and its partners, in compliance with a presidential decree. The process is in progress.

When the export of iron starts, a prime market will be open for China, curiously and simultaneously the largest producer and importer of this product in the world.

Due to this double condition, China has a decisive role to play in setting the reference price of the iron in international markets.

Diamantino Azevedo says that other countries may appear, with some metallurgical activity, interested in buying iron from Angola, but the Asian giant is certainly the first candidate.

Source: Angop