HBIS Resources Co Ltd, a unit of
China’s second-biggest steelmaker HBIS Group, said on Monday it had
signed an initial deal to develop the Pampa de Pongo iron ore mine in
Peru alongside current licence-holder Zhongrong Xinda.
The two Chinese companies plan
to set up a joint venture to work on the first stage of the mine, which
also contains copper, cobalt and gold reserves, an HBIS Resources filing
to the Shenzhen Stock Exchange showed.
The scope of cooperation
includes mine and port construction and operation, it added. No value
was put on the framework agreement, which was signed on July 31 and will
serve as a basis for negotiations between the two firms.
Investing in Peru, the world’s
second-biggest copper producer after neighbouring Chile, would be HBIS’
first foray into South America. It coincides with steady demand from
Chinese steel mills as prices of iron ore, the main steel-making
ingredient, top $100 a tonne.
Qingdao-based Zhongrong Xinda
acquired the rights to Pampa de Pongo in 2016 and its subsidiary Jinzhao
Mining Peru is the project’s operator.
A portfolio published by Peru’s
Ministry of Energy and Mines in October 2018 said Pampa de Pongo, in the
Arequipa region, could produce 28.1 million tonnes of iron per year and
was expected to start operations in 2023.
It put the investment required
at $2.2 billion.
Peru in mid-March imposed a
mining lockdown to curb the spread of the new coronavirus, but has since
eased restrictions. The country has reported more than 400,000 confirmed
coronavirus cases and more than 18,000 deaths from covid-19, the
respiratory disease the virus causes.
Source: Reuters |