HomeBase MetalsDelta quits Liberian iron ore project

Delta quits Liberian iron ore project

Monrovia, capital of
Johannesburg, South Africa — MININGREVIEW.COM —27 May 2009 – South African mining and exploration company Delta Mining Consolidated Limited has quit plans to develop the US$1.6 billion (R14.4 billion) Western Cluster iron ore project in the West African country of Liberia.

Confirming this to Bloomberg News in a mobile telephone interview, Delta director Bernard Swanepoel said the decision had been taken because the Liberian government had added bidding terms the company could not meet. “One of the requirements was a large cash guarantee, which wasn’t doable in the short time we had available,” he said. “This specific project is now out of our hands.”

The Liberian government had previously named Delta as preferred bidder for the giant project, but then reversed its decision last September, claiming that the bidding process might have been compromised. It barred Delta and Tata Steel from participating in a new tender, over allegations of what it called “external influence or impropriety.”

Then last month it cleared the Johannesburg-based company of all alleged improprieties, prompting Delta to withdraw a legal order preventing Liberia from re-tendering the project.

“Liberia remains a country with iron ore opportunities,” Swanepoel said, adding that the government had pointed out one or two projects Delta may be interested in.

The Western Cluster project consists of three deposits and two idled mines. The mines on the deposits closed in 1976 and 1985 and their equipment was sold as scrap during Liberia’s two civil wars, the last of which ended in 2003.