Australian company, Sphere Investments Ltd - the former owner of the AirBoss tyre technology - has entered a joint venture to develop the Guelb el Aouj iron ore deposits in Mauritania with Societe Nationale Industrielle et Miniere (SNIM).
The Guelb el Aouj deposits are located in an undeveloped area some 35km from the existing iron ore mines and concentration plant operated by SNIM. The deposits contain approximately 50Omt of magnetite iron ore and are part of a major mining province in Northern Mauritania.
The Guelb el Aouj project will involve the establishment of a new open-cut mining operation, concentration plant, and the introduction of a pelletisation plant designed to produce 5-7mtpa of pellets for both the premium direct reduction iron market (DRI) and the traditional blast furnace market.
The project will use SNIM's existing infrastructure to transport the iron ore by heavy haulage rail and load it at the port of Nouadhibou.
Sphere has the right to earn equity in the project in return for completing a three stage bankable feasibility study. The company can earn a 20% interest in the project by completing stage 1 of the feasibility study at a cost of US$1m.
Sphere can earn an additional 30% interest in return for completing the other two stages of the bankable feasibility study at a further cost of US$10m.
The company is evaluating the alternatives for funding its involvement in the project.