AKORA Resources strengthens ties with Madagascar as Bekisopa iron ore project advances

AKORA Resources (ASX: AKO) continues to tighten its relationship with the government of Madagascar as it progresses the Bekisopa iron ore project.

The company recently held positive discussions with representatives from the Malagasy Ministry of Mines, in which the government confirmed its support for the project.

Currently progressing through a pre-feasibility study (PFS) and towards a final investment decision, the Bekisopa project has a 194.7 million tonne inferred JORC resource.

Appropriate support

Managing director Paul Bibby and chair Graeme Hunt held several meetings with Madagascar’s mining minister Dr Olivier Herindrainy Rakotomalala and his delegation in early September at the Africa Down Under (ADU) conference in Perth.

“During our meetings, the department confirmed it was open and welcoming to foreign business and would continue to work closely with AKORA to ensure the Bekisopa project received appropriate support to ensure favourable economic, environmental and social outcomes for all stakeholders, particularly the region’s communities,” Mr Bibby said.

The Malagasy delegation also presented a showcase workshop at ADU for exploration companies and investors on the recently implemented improvements to the mining code and the way forward for exploration and mining companies in Madagascar.

Madagascar visit

Following those meetings, the minister requested Mr Bibby visit Madagascar for further discussions focused on the activities required to progress Bekisopa towards a final investment decision.

The main points tabled at this meeting were related to the preparation and shipping of a bulk representative iron ore sample for value-in-use testing by major steelmakers, a necessary activity to validate Bekisopa direct shipping ore (DSO), along with the process and timing for upgrading the current Bekisopa exploration permits and granting the mining permit.

The minister confirmed the government would work with AKORA to deliver on these key items as work on the PFS, including the environmental and community studies, continues.

Two-stage development

AKORA’s plan is to develop Bekisopa in two stages, with Stage 1 producing approximately 62%-grade DSO and production ramping up to 2Mtpa.

The company is targeting the valuable “green steel” technology used to make steel without coal while producing considerably fewer carbon emissions.

That technology requires iron ore grades of at least 67% and AKORA has already had positive discussions with potential buyers regarding its premium-priced minimum 68%-grade iron concentrate.

The company is also advancing plans to generate early cash flow in the near term with an option to produce up to 2Mtpa of a 60%-grade DSO over the first five years for shipping to blast furnace-basic oxygen furnace steelmakers.