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Congo-Brazzaville Mining Report

Congo-Brazzaville Mining Report

BMI View: The Republic of the Congo (Congo-Brazzaville)'s iron ore reserves offer the sector significantgrowth potential. Despite this, a contraction in global iron ore demand and prices will continue to curb thedevelopment of the sector as junior miners in particular struggle to maintain profitability.

Latest Developments & Structural Trends

Congo-Brazzaville's considerable iron ore reserves and the high-grade of its deposits have seen thecountry increasingly targeted by international investors in recent years, particularly as deteriorating ironore prices squeezed the operating margins of many producers. Many of the country's deposits have anaverage grade of above 60%, compared with the global average of about 40-50%. The development ofthe Congo's mining sector will have significant macroeconomic implications as it will diversify thecountry's dependence on oil revenues, which currently account for approximately 90% of exportearnings.

Zanaga Iron Ore, which owns 50% less one share of the Zanaga mine in partnership with Glencore,will be one of the sector's key growth drivers. Glencore owns the other 50% plus one share interest andhas effective management control of the Zanaga Project. As of Q215, the project is estimated to hold2.1bn tonnes of iron ore with a high grade of 66% fe. The project will produce 30mn tonnes per annum atfull production capacity, with a mine life of 30 years. The total capital expenditure for this project isestimated to be USD2.6bn.

BMI Industry View
Industry Forecast
Congo Iron Ore: Low-Price Environment May Undermine Growth
Table: Largest Iron Ore Projects
Industry Risk/Reward Index
Africa: Major Risks Remain
Key Takeaways
Latest Revisions
Table: Africa - Mining Risk/Reward Index
Regulatory Development
High Ore Grade, Yet Weak System
Commodities Forecast
Commodities Outlook
Table: BMI Commodities Price Forecasts
Competitive Landscape
Table: Competitive Landscape
Company Profile
Table: Glencore - Key Financial Data
Regional Overview
Table: SSA - Government Involvement In Mining Sector
Industry Forecast Methodology
Risk/Reward Index Methodology
Table: Weighting Of Indicators

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