Iron Ore Opportunities in Swaziland

Commodity – Iron Ore
Country – Swaziland
Region – Africa

Iron Ore Opportunities in Swaziland

As the iron ore mining opportunities diminished in India due to investigation of Shah Commission and ban by the Supreme Court during 2013-2014, miners started to find opportunities in outside India. One of our clients who rank among the largest miners in India wanted to invest in small low-cost iron ore prospect in Swaziland which is considered as the world’s oldest, about 42,000 years old. They wanted us to conduct a project viability study.
Geovale engaged its mining and analytical team who have reach experience in working in South African condition and analyzing the iron ore market to conduct this project. We scrutinized the project reports, production plan, grades, company’s shareholding structure etc. and presented to the client. We started with the suitability of the country from investment point of view. Swaziland is a landlocked country, almost completely surrounded by South Africa. The terrain is mostly mountainous and hilly. The mining legislation in Swaziland is pretty vague where royalty rates are unspecified and in some cases negotiable. Plus private investors are restricted to 50% shareholding only – the King and government are entitled to get two free equity stakes of 25% each. It was mainly a hematite deposit with low grade of 44.5% Fe. Moreover, the ore was available only from dumps. However, the cost of production was encouragingly low at $42/t which could be trimmed down by improving operational efficiency and productivity. We suggested the client a go ahead with prospect for further due diligence.