Johannesburg, South Africa — MININGREVIEW.COM — 21 July 2011 – South African iron ore miner Kumba Iron Ore is scouting west Africa for new projects and acquisitions as it seeks to expand and benefit from record prices that lifted the company’s first-half profit by 40%.
Africa’s largest producer of the steelmaking ingredient also said that it expected stable production and export sales for the full year, despite downward pressure on prices.
Kumba “’ a unit of global miner Anglo American “’ said that with domestic expansion on track, it was looking to west Africa for potential projects, hoping to produce 10 to 20Mt of ore from the region by 2020.
Chief executive Chris Griffith said the miner would look at both building projects from scratch or acquiring existing assets in the region. “It will probably be a combination of that. We are in early stages of exploration and discussion in West Africa,” he told reporters.
Africa is regarded by many in the industry as the next iron ore frontier with many global miners moving in to cash in on the projected rise in demand for steel from Asia.
Kumba said its R8.5 billion Kolomela project in South Africa, meant to lift the group’s total annual output by 9Mtpa, was on track and within budget.
The world’s 10th largest producer of iron ore, Kumba said first-half output had fallen by 13% to 19.15Mt, due to excessive rainfall. “Management has implemented focused plans to recover the majority of the shortfall in first-half production by the end of 2011,” the company said.
Kumba expects modest downward pressure on iron ore prices in the final quarter of 2011, due to seasonally lower crude steel production during the second half of the year.
The company said it expected costs for the full year to rise by 25$.