Hong Kong-based China International Fund (CIF) has signed a binding memorandum of understanding (MOU) to finance a US$2.7bn infrastructure project for African mining company, Bellzone.
In another showing of Asia’s interest in African trade, the binding MOU sees CIF agreeing to fund the entire infrastructure required for the Kalia iron project in Guinea, West Africa, including the rail systems, bulk storage facilities, port facilities and power development.
In return, Bellzone will grant CIF the right to purchase 100% of the prospects from the Kalia project and transferring to CIF 50% of a second iron ore prospect as well as agreeing to form a joint venture to finance, develop, produce, transport, export and sell iron ore from another permit.
The agreement is expected to be put into motion from June 30 this year.
“I am delighted to announce this binding MOU with China International Fund. This agreement will significantly de-risk Bellzone’s implementation strategy by ensuring Bellzone’s production value chain is secured from mine to customer,” says Nik Zuks, managing director of Bellzone Mining.
He adds: “CIF is a highly regarded group of companies with a proven track record of developing large infrastructure projects in Africa and has got a serious commitment to Guinea and its development. This infrastructure project, estimated at US$2.7bn, is intended to form the first leg of developing a multi-user railway and port that is expected to open a number of opportunities for Guinea’s mineral deposits.”
The Republic of Guinea’s minister of mines and geology, Mahmoud Thaim, adds: “This creates the most strategic link of the transport network required to unlock Guinea’s iron potential. It puts two mines on line within four years, instead of one, and multiplies annual mining revenue tenfold in a short time. It’s historical and transformational.”
Last Updated May 25, 2010
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