Zanaga advances Congo iron ore venture with major financial gains
Zanaga Iron Ore Co Ltd. has announced significant progress in improving the economics of its Republic of Congo iron ore project, highlighting potential cash-cost savings of around US$2.2 billion. This update comes as the company advances discussions on a strategic investment and potential project financing worth up to US$500 million.
In its latest economic assessment released in April, Zanaga reported a combined net present value (NPV) for Stage One and Two of the project at US$4.90 billion, a 29.4% increase from the 2024 feasibility update. The NPV for Stage One alone rose by 30.9% to US$2.54 billion, despite a 12.4% rise in estimated capital expenditure to US$2.17 billion.
Red Arc Minerals (RAM), which signed a binding investment term sheet with Zanaga in February, has presented evidence of a letter of intent from a Western government-backed development finance institution for potential financing of up to US$500 million. The deadline for RAM to complete the proposed transaction and make its first Tranche One payment has been extended to 30 November.
Meanwhile, Zanaga’s bulk excavation for its sampling programme was well underway as of 28 September, remaining on schedule. This programme aims to test the project’s revised direct reduced iron (DRI) flowsheet at pilot scale and produce material for customer testing.
Financially, Zanaga reported cash reserves of US$3.7 million as of 17 September, following a successful £5.6 million equity raise completed in May.
This combination of cost-saving initiatives, strategic financing talks, and ongoing project development underlines Zanaga’s commitment to advancing its iron ore project towards successful implementation and long-term value creation.
