African Minerals Ltd will invest more than $300 million to develop a deep-water port and reinvigorate Sierra Leone's railway over the next two years, its chairman said in an interview.
African Minerals, formerly known as Sierra Leone Diamond Company Ltd, is listed on London's junior AIM exchange.
The development, which includes upgrading the defunct narrow gauge railway to standard gauge, will link the company's two iron ore mines in the north of the country to the deep-water port site at Pepel, 180 km (112 miles) away.
It will happen. We should start next month, Chairman Frank Timis told Reuters late on Sunday at a reception for visiting Irish singer and anti-poverty campaigner Bob Geldof, attended by ministers and the country's first lady, Alice Sia Koroma.
African Minerals, which last year made a net loss of $42.3 million, has a combination of prospecting, exploration and mining licences for 57 percent of the former British colony's total land mass, but has said it will soon relinquish about half of that.
The railway hasn't worked since the 1970s so this is big, said Timis, who has a 26.3 percent share of the company. It will be finished within 18 to 22 months, depending on the supply of steel from countries like India, China, Ukraine and Romania.
The two iron ore sites are a 209 sq. km (80.6 square miles) concession at Tonkolili in the north of the country about 180 km (112 miles) from Pepel, and a larger site nearer to the port at Marampa, which operated for about 30 years until it closed in 1970.
We estimate conservatively that it's potentially over 2 billion tonnes, said Timis of the Tonkolili site. Timis said the iron ore mine had an expected lifespan of 40 to 60 years, and would be operating within three to four years once the infrastructure, including a power plant, is in place.
We have invested $110 million since it started in 2003. The whole thing will cost more than $3 billion. We have the backers, said Timis, a one-time Romanian refugee now living in London.
Singer and poverty campaigner Bob Geldof, who flew in on the company's private plane for his first visit to the country, said the investment could make a huge difference to the economic outlook of the West African state, ranked the world's least developed by the U.N.
If Frank is going to build a modern railway and with the port now functioning then it should be a matter of urgency to connect up with the people and agricultural exports. That way they can grow their rice and transport it for the export market. If it's a deal of mutuality, I'm there, said Geldof.
In addition to iron ore, African Minerals is also exploring for nickel-cobalt, uranium and gold at other sites throughout the country and last year exported 18,071.45 carats of diamonds with a value of $8.5 million from two sales. (For full Reuters Africa coverage and to have your say on the top issues, visit: http://africa.reuters.com/) (Reporting by Katrina Manson; Editing by Ingrid Melander and Peter Blackburn)
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