The Wadi Sawawin Project located in the north-west corner of Saudi Arabia, 125km from Tabuk and 60km from the Red Sea port of Duba. Wadi Sawawin is of strategic and economic importance to Saudi Arabia as it will provide a domestic source of Direct Reduction (“DR”) pellets for use in the DRI steel plants which account for 90% of steel production in the Middle East and North African region. The location of Wadi Sawawin will provide it with a competitive advantage over competing Brazilian and European supply through reduced freight rates from its deep water port in the Red Sea and access to low cost Saudi Arabian energy. In addition, the project will assist in the programme of diversification of the economy which is an important element of Saudi Arabian economic policy, and the government is expected to provide low cost funding via the PIF and SIDF
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The process to secure the funding of the Wadi Sawawin project continues. There have been initial positive discussions with the power, water and port authorities in Saudi Arabia regarding the provision of these services. In the event that agreements are reached, this would materially reduce the capital expenditure requirement of the project. London Mining is currently producing 10 tonnes of concentrate at a pilot plant in Perth, Australia to enable DR pellet samples to be produced by pellet plant bidders, and to provide samples to potential offtake providers.
National Mining Company (“NMC”) and London Mining continue to work jointly on the ongoing application to the Deputy Ministry for Mineral Resources for an exploitation licence for the proposed 5Mtpa 20 year operation and there are ongoing discussions
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In July 2010, London Mining announced the results of an updated bankable BFS for the Wadi Sawawin project and a revised agreement with its partner NMC.Under the terms of the new agreement signed on 20 July 2010, in return for no further material funding requirements and no further dilution in subsequent equity fundings, London Mining will receive a direct interest of 25% in the Wadi Sawawin project through NMC. NMC holds the historical exploitation licence for the Wadi Sawawin project and three adjacent exploration licences. The Chairman of NMC is Prince Nawaf bin Sultan bin Abdul Aziz al Saud, who has provided his full commitment to the project and to this agreement. This agreement supersedes the previous agreement whereby London Mining held a 50% interest in a joint venture company, Saudi London Iron Limited, into which the licences were going to be transferred. Upon closing London Mining will receive shares equal to 25% of the issued share capital of NMC.
London Mining is to recieve a direct interest of 25% in the Wadi Sawawin project through its joint venture partner in the project National Mining Company (NMC). NMC holds the historical exploitation licence for the Wadi Sawawin project and three adjacent exploration licences. This agreement supersedes the previous agreement whereby London Mining held a 50% interest in a joint venture company, Saudi London Iron Limited, into which the licences were going to be transferred. Upon closing London Mining will receive shares equal to 25% of the issued share capital of NMC.The current indicated JORC resource of 248Mt grading 39.8% Fe is sufficient for a mine life of 21 years at the run rate of 5Mtpa. In addition, London Mining has inferred resources of 134Mt grading 39.2% Fe (as well as further exploration targets) which may provide the basis for an extension of the mine life at 5Mtpa by over 10 years or an expansion to 10Mtpa. London Mining will continue to undertake sufficient exploration to maintain the licences in good standing until funding is secured. The current resource is based entirely within the Western exploration licence and is contiguous with the current exploration licence.
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The process to secure the funding of the Wadi Sawawin project continues. There have been initial positive discussions with the power, water and port authorities in Saudi Arabia regarding the provision of these services. In the event that agreements are reached, this would materially reduce the capital expenditure requirement of the project. London Mining is currently producing 10 tonnes of concentrate at a pilot plant in Perth, Australia to enable DR pellet samples to be produced by pellet plant bidders, and to provide samples to potential offtake providers.
National Mining Company (“NMC”) and London Mining continue to work jointly on the ongoing application to the Deputy Ministry for Mineral Resources for an exploitation licence for the proposed 5Mtpa 20 year operation and there are ongoing discussions
.
In July 2010, London Mining announced the results of an updated bankable BFS for the Wadi Sawawin project and a revised agreement with its partner NMC.Under the terms of the new agreement signed on 20 July 2010, in return for no further material funding requirements and no further dilution in subsequent equity fundings, London Mining will receive a direct interest of 25% in the Wadi Sawawin project through NMC. NMC holds the historical exploitation licence for the Wadi Sawawin project and three adjacent exploration licences. The Chairman of NMC is Prince Nawaf bin Sultan bin Abdul Aziz al Saud, who has provided his full commitment to the project and to this agreement. This agreement supersedes the previous agreement whereby London Mining held a 50% interest in a joint venture company, Saudi London Iron Limited, into which the licences were going to be transferred. Upon closing London Mining will receive shares equal to 25% of the issued share capital of NMC.
London Mining is to recieve a direct interest of 25% in the Wadi Sawawin project through its joint venture partner in the project National Mining Company (NMC). NMC holds the historical exploitation licence for the Wadi Sawawin project and three adjacent exploration licences. This agreement supersedes the previous agreement whereby London Mining held a 50% interest in a joint venture company, Saudi London Iron Limited, into which the licences were going to be transferred. Upon closing London Mining will receive shares equal to 25% of the issued share capital of NMC.The current indicated JORC resource of 248Mt grading 39.8% Fe is sufficient for a mine life of 21 years at the run rate of 5Mtpa. In addition, London Mining has inferred resources of 134Mt grading 39.2% Fe (as well as further exploration targets) which may provide the basis for an extension of the mine life at 5Mtpa by over 10 years or an expansion to 10Mtpa. London Mining will continue to undertake sufficient exploration to maintain the licences in good standing until funding is secured. The current resource is based entirely within the Western exploration licence and is contiguous with the current exploration licence.