Xstrata moves into iron ore in Congo | Shanghai Daily

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November 25, 2009

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Xstrata moves into iron ore in Congo

MINING group Xstrata has made its first entry into the iron ore sector by funding an exploration project in the Republic of Congo.

Anglo-Swiss Xstrata will pay at least US$50 million toward prospecting and a pre-feasibility study of the Zanaga project in the Lekoumou district of the Republic of Congo, also known as Congo Brazzaville.

"We've always said that we were interested in iron ore and this looks like a very interesting opportunity to enter into a very early stage project," spokeswoman Claire Divver said yesterday.

"It is at a very early stage, but the indications so far is that it may be a significant iron ore resource, it could be a world-class iron ore project."

The deal is important since it may mark a shift for acquisitive Xstrata to smaller-scale, early stage growth projects, brokerage Cazenove said.

"While still early stage, this transaction marks a significant event for Xstrata as it enters into its much sought after commodity at a very attractive price," Cazenove said.

On October 15, Xstrata ditched its merger proposal to combine with rival Anglo American Plc.




 

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