A pre-feasibility study (“PFS”) was conducted by the IDC in August 2012.
The key findings of the PFS include:
After the PFS was concluded, IDC embarked on a process to find a strategic equity partner which led to the Memorandum of Understanding executed with China’s Hebei Iron & Steel Group (HBIS) in September 2014.
HBIS’s participation is conditional upon using their core competence which is based on BF technology as well as to increase the target size of the project to 5mtpa of which a substantial portion will be exported, to other Sub-Saharan African markets. The BF process necessitates the use of coking coal that would need to be imported (possibly from Mozambique). The capacity change, new markets identified and raw material import requirements may put an inland site such as Middelburg at a competitive disadvantage. Therefore, they are considering a coastal site as an alternative.
HBIS and IDC are currently conducting additional prefeasibility studies to assess the economic viability of BF technology, increased size and the project location. Depending on the outcome of these additional prefeasibility studies, a detailed feasibility study will be conducted before a final investment decision is made.
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