Corridor Sands - an exciting opportunity for regional employment and contracts

Still in the planning stage of development, the US$500 million Corridor Sands project contains immense deposits of titanium dioxide minerals located near the town of Chibuto in the Gaze province of southern Mozambique, 190 km north of Maputo.

The deposits, located about 50 km inland from the Indian Ocean, were discovered in late 1997 and represent the world's largest known economic resource of titanium dioxide (TiO2) and associated minerals. The size and scale of this mineral deposit, accounting for a third of the world's known ilmenite resources, is such that the eventual scale of operations could rival the largest and most important producers of feedstocks for the world titanium dioxide industry throughout the next 100 years. When developed, Corridor Sands will also be among the lowest cost quartile producers.

"Estimates are that the Corridor Sands ore body has a 100-year life, yet reserves have only been delineated for the first 35 years," says project manager for Corridor Sands, Brian Taylor.

About US$120 million has been spent on the project to date, including the bankable feasibility study, costing US$10 million. Up to US$87 million will be paid by the Australian mining company, WMC Resources Ltd, to acquire full project control from the South African-based Southern Mining Corporation.

Mineral sands represents a new commodity area for WMC, which is a company with total assets approaching US$5 billion, underpinned by significant copper, nickel, fertiliser and uranium oxide production. The Corridor Sands project is WMC's first major venture into Africa.

Says Taylor: "The Mozambican Government has been very co-operative and constructive. They have been good to work with and have offered Corridor Sands similar incentives offered to other large US$400 million plus projects."

The project is now 90% owned by WMC through its subsidiary Corridor Sands Limitada, following the Industrial Development Corporation of South Africa announcing its intention to exercise its 10% option. The project is expected to involve an initial investment of about US$500 million for the recovery of 400,000 tonnes of TiO2 slag. A total investment of US$800 million should ensure the project reaches an eventual production level of one million tonnes of TiO2 slag.

Taylor says that since the bankable feasibility study was completed in 2002, the project team has been spending 2003 completing the estimate for the export facilities, looking at optimising the design of the operation and undertaking value engineering opportunities.

"In particular, we are currently looking at the big ticket items and how we can improve their overall cost effectiveness," he says.

One example of this is the transport of product from the project site to the coast for storage and shipping, using a road-train transport system. This approach will typically use a three-trailer rig, with a payload of over 100 tonnes per road train using a dedicated black top road.

"We are completing the environmental impact assessment work for this aspect of the project and hope to integrate this approval within the environmental license which has already been issued," Taylor adds.

A power agreement for Corridor Sands Ltd. is in place, but alternatives are being considered and are still to be finalised. The EPCM contract for the construction of phase one, which is planned to take 29 months to complete, should commence in 2005. It is planned that the smelter will be commissioned in 2007, with the first product to be delivered to customers later that year.

Currently, the Corridor Sands project is recruiting people for its team, which consists of 26 people located in Mozambique, South Africa and Australia. At the peak of construction, there will be about 4,500 contractors on site. Phase one of the project will create 800 permanent jobs and an additional 500 semi-permanent contract positions, and with the multiplier effect on further job creation, it will indirectly lead to many new jobs in Mozambique.

Infrastructure

According to the plan, silos will be used to store the chloride and sulphate slags, while the zircon and rutile will be bagged and stored under cover at the storage area. The pig iron produced will be stored on concrete pads. The storage facilities are expected to accommodate about two months worth of production. The ships loader will be capable of feeding between 1,000 and 1,500 tonnes per hour of product onto the vessels, and the jetty facilities will allow for expansion as the project develops.

"We are still evaluating the optimal stockpile-silo-shed design, and the best method for loading the seagoing vessels," says Taylor.

The road, jetty and related infrastructure should cost around US$80 million and will be designed to accommodate Handimax (40,000 tonne) and possibly Panamax (70,000 to 80,000 tonne) vessels.

During the first phase, Corridor Sands will use around155 MW of power, increasing to 350 MW at full capacity. The power infrastructure will cost about US$40 million and Taylor says this is an item close to the project's critical path. The original plan was to purchase power from Eskom, wheeled through to Maputo and then via a 200 km long 400 kV power line from Matola to the project site. However alternative options are being evaluated to establish the most cost effective package of securing reliable power at a competitive price.

The Corridor Sands deposit

The origin of the Corridor Sands deposit lies in the history of the Limpopo river. Millions of years ago the channel in which the Limpopo river now flows was far larger, carrying all the waters of the present Zambezi, Sashi and Kafui rivers as well as the flow of the Limpopo. Structural uplift of the African continent associated with the Rift Valley, has since redirected the Zambezi river from the Limpopo valley - and in the process formed the Victoria Falls. The mouth of this massive ancient Limpopo/Zambezi river system was in the area of Chibuto where the river deposited its load of heavy minerals, carried from far inland into the Indian Ocean. The dual winnowing action of the longshore currents and the sea winds resulted in the heavy minerals becoming concentrated in huge beach sand dunes, which are now about 50 km inland.

Several separate ilmenite-bearing sand deposits have been discovered within the project license area. Work has focused on the largest of these, Deposit One, which has been resolved into two higher grade zones called the West Block and East Block. It is planned to mine the West Block first, and this will supply more than the first 25 years of plant feed at full production. However, enough drilling has been completed over the East Block to establish indicated resources there.

More than 1,100 aircore holes have been drilled providing 65,000 metres of sample, of which some 600 were drilled in the West Block with a "measured and indicated resource" of 1,765 million tonnes containing 73 million tonnes of ilmenite at an estimated average ilmenite grade of 4.14%. A total of 12 triple-tube diamond-tipped drill holes covering 1,153 metres have also been drilled in the West Block with good core recoveries. Down-hole geophysics and trial pit testwork have indicated that true ilmenite grades in the deposit are in excess of 15% higher than the values indicated by aircore drilling. All of Deposit One mineralisation extends from the surface with no overburden, and thus no mining dilution.

Mining Corridor Sands

The mining method proposed for Corridor Sands is conventional truck and shovel mining. In the early years, trucks are expected to have 100-tonne payloads, but as the mine progresses other mining methods will be evaluated, such as larger trucks and loading equipment, bucket wheel excavators, trucking to a conveyor or pumping. Mine planning will optimise the grade in the project's early years starting in the high grade areas close to the site of the proposed processing plant. Mining is expected to recover ilmenite at a grade of 7% for the first five years and at a grade of 5.4% for the next ten years.

The mine will be developed as an advancing-face open pit mine, with the waste sand and unwanted minerals deposited back into the pit behind the advancing mine face, which will then be rehabilitated to international standards. According to the plan, the mine pit design is being optimised during the current engineering phase. The tailings dam is also being reviewed with a view to achieving a more cost effective design. As there will be no stripping ratio, the pit size will be approximately 80 metres in length up to a maximum depth of 160 metres, with a mining rate of 18 million tonnes a year, operating 24 hours a day.

The processing route

The testwork on the Corridor Sands material has shown that it is suited to simple, proven and cost-effective mineral separation and upgrading techniques for the production of marketable products. The process will involve a primary concentrator, a mineral separation plant, and a roasting and smelting phase. A primary concentrator plant will separate a heavy mineral concentrate from waste sand and fines by simple water based gravity separation methods, using spiral concentrators and cyclones. The equipment specified for the primary concentrator is in use at other operations within the mineral sands industry so the technical risks are low.

The heavy mineral concentrate produced by the primary concentrator plant will be a mixture of various sand-sized particles, with ilmenite making up about 70% of the concentrate. The remainder of the concentrate will be the by-product minerals, rutile, leucoxene and zircon, as well as a small proportion of waste minerals. The mineral separation plant will not alter the nature, size or chemistry of the mineral particles, but will use the minerals various physical properties to separate the individual products.

Ilmenite contained in the heavy minerals concentrate will be extracted by a wet magnetic separation process with the final stage of the mineral separation plant being a dry mill that will separate the rutile and zircon by using the differences in their surface conductivity and magnetic susceptibility. The chromite in the ilmenite is undesirable and this calls for a roasting stage, which takes raw ilmenite from the mineral separation plant and heats it to about 750°C. This process increases the magnetic susceptibility of the ilmenite, which makes it easier to use magnets to extract pure ilmenite low in chrome, but of high enough quality to feed into the smelter. This roasting operation will use the off-gas from the electric furnaces, and no additional fuel will be required. Roasted ilmenite and high quality anthracite will be fed to the furnaces through a single hollow graphite electrode positioned in the centre of each furnace.

Three furnaces, each rated at a nominal 125,000 tonnes a year of slag production are to be constructed for the first phase of the Corridor Sands project, producing slag containing 85% TiO2. It is expected that improvements in smelter design and operational improvements will allow for the production of one million tonnes of slag a year, when full production is reached, using only seven furnaces. Smelter design and downstream processing are being revisited to confirm and improve the design. The DC smelting technology to be used is similar to that used by other producers in South Africa "We have made a conscious effort to seek out and engage proven technology with the Corridor Sands project. This not only puts us a more certain footing, but also represents less risk to shareholders," says Taylor.

The market for Mineral Sands

Corridor Sands will be a significant contributor to the titanium dioxide market, initially providing 300,000 tonnes a year of titanium dioxide units out of a market consuming 4.6 million tonnes a year, of which South Africa currently supplies around 30%. A total of 54% of the world's known reserves of ilmenite are found in southern Africa.

A project like Corridor Sands and the products it is expected to produce are lifestyle products and are linked to the world economy. It is expected that the global economy will grow at close to 2.7% a year and the increase in demand for titanium dioxide should grow in line with this figure. It is anticipated that by the time the Corridor Sands project expands to its full capacity of one million tonnes a year, global demand will be about 5.2 million tonnes a year. Even then, Corridor Sands will only provide around 16% of the world supply, compared with Richards Bay Minerals in South Africa and the Iluka operations in Western Australia and USA, which supply well in excess 20% of the world market each.

Since 2001, there has been an oversupply of titanium dioxide feedstock and this is expected to be back in balance again by 2007, assuming the world economy follows the average growth trend. The annual increase in demand for titanium dioxide is projected to be about 110,000 tonnes a year and Taylor says that Corridor Sands wants to position itself to take the slack at the time the market moves out of its state of surplus.

Of course, there are no guarantees that the world markets will behave as expected, and prior to the 2001 September 11 attack on the US and the SARS virus in China and elsewhere, the window of opportunity for the project had been 2005.

"We would not have fast tracked the project, but the extra time gained has allowed us to be very thorough, and evaluate many options. It suits us nicely," says Taylor.

Mining Review Africa issue 5 2003