Iron ore on the
conveyor at Kumba’s
current Sishen mine
 
Johannesburg, South Africa — MININGREVIEW.COM — 01 August 2008 – Kumba Iron Ore Limited – born out the unbundling of Kumba Resources and now the world’s fourth largest supplier of sea-borne iron ore –   has approved an R8.5billion investment in the new Sishen South mine.
 
The mine is located 80km south of the Sishen mine, near Postmasburg in the Northern Cape, and is scheduled to start production in the first half of 2012, ramping up to full capacity of 9Mtpa in 2013.

A Kumba statement released here said Sishen South would have in excess of 20 years’ life, and would produce direct shipping ore with product qualities of 64% Fe lump and 63.5% Fe fine ore for the export market. The ore would be transported on the main Sishen-Saldanha rail line to the port of Saldanha Bay via a rail link to be built from Sishen South mine.

Kumba CEO Chris Griffith commented: “This development forms part of Kumba’s expansion strategy to grow iron ore export channel volumes to 44Mtpa by 2013. Including current domestic production of 9Mtpa, this would increase total production to well over 50Mtpa. The project pipeline remains robust with the potential to deliver 70 Mtpa by 2015,” he added.

The statement went on to say that his milestone had been made possible by the recent granting of Sishen South’s new order mining rights, the issuing of its integrated water use licence, and the positive conclusion to the negotiations with Transnet regarding the additional capacity on the Sishen-Saldana iron ore export channel. It added that Eskom had also committed to honour the supply contract for electricity to Sishen South.

“An experienced project team has been secured and we have ensured that the people and skills deployed in the Sishen expansion project were retained for the development of the Sishen South mine,” Griffith said. “Orders have also been placed on long lead equipment, which means that we are in a strong position to ramp up swiftly to full capacity.”

Kumba points out that the mine will have a positive impact on the economy of the Northern Cape. Approximately 750 people will be employed by the mine, with a further 2 000 jobs created at the peak of the construction phase. Indirect job creation is estimated to be in the region of 4 000 jobs.

Kumba expects the iron ore market to remain attractive for some time and customers are very excited about Sishen South coming on line,” said the statement. “We are delivering this additional capacity into a market of favourable iron ore prices and strong demand,” it concluded.