Zimbabwe central banker stockpiles gold to bolster ZiG currency
The ZiG - short for Zimbabwe gold — is the nation’s sixth attempt at having a functioning local currency in the last 15 years.
African Minerals Ltd., closed up 7.1% in London on Monday after completing an investment accord with Shandong Iron & Steel Group Co bringing the counter’s gains for the year to 57% and giving it a market capitalization of some $3.6 billion.
Shandong will invest $1.5 billion for a 25% stake in African Minerals’ massive the Tonkolili iron-ore project in Sierra Leone. Phase I of the project will cost $1.2 billion and includes railway and port reconstruction in the war torn country while phase II and III will add another $8 billion to the bill. Sierra Leone, one of the world’s poorest nations, is attracting increasing investments in its natural resources which also include diamonds and bauxite.
Businessweek reports the investment needs Chinese regulatory approvals and includes discounted iron ore sales from the Tonkolili mine, African Minerals said. The Chinese company will purchase 2 million metric tons of the steelmaking raw material a year from the first stage of the project.
Phase I will enter production in Q4 2011 at a planned rate of up to 12Mtpa DSO lump and fines product. This $1.2bn project involves the complete reconstruction of the Pepel Port, the complete reconstruction of 74km of existing railway, the completion of a new 126km narrow gauge railroad, and the establishment of a major mine. The next two stages of expanding the mine will cost about $8 billion – Phase II involves further rail and port infrastructure and Phase III the production of up to 45Mtpa of magnetite concentrate from the primary magnetite mineralisation.
Gross national income per capita in Sierra Leone with 6.2 million citizens stands at just $340 a year and the national budget is a mere $500 million. Between 1991 and 2002 civil war devastated the country leaving more than 50,000 people dead and much of the country’s infrastructure destroyed.
Image of railroad construction at the Tonkolili project courtesy of the company.
