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Energy and mining investment projects in Cameroon
2009-12-08
Brief:It is reported that Cameroon hopes to triple electricity output to 3,000 MW by 2020 through a series of hydro and thermal generation projects.

It is reported that Cameroon hopes to triple electricity output to 3,000 MW by 2020 through a series of hydro and thermal generation projects.

As per report, the move is aimed at increasing public access to power in the West African coastal nation while also paving the way to expand the energy intensive mining sector.

Below are investment projects in a country aiming to develop its energy and mineral resources and expand its ports.

Aluminum and bauxite

1. Rio Tinto Alcan is a partner with Cameroon's government in Alucam an operation scheduled to include 1 million tonne aluminum smelter at Kribi. Rio has said the project including 1,000 MW hydroelectric dam to power the smelter will cost 140 billion CFA francs. Construction timeline is 2015 to 2018.

2. US firm Hydromines, the United Arab Emirates's Dubai Aluminum and India's Hindalco Industries have formed Cameroon Alumina Limited. The consortium said that it has found 550 million tonnes of bauxite and is targeting at least another 200 million tonnes.

With start up planned for 2013, the consortium plans to invest USD 5 billion to USD 6 billion in a bauxite mining and refinery project at Ngaoundal, north of the capital, Yaounde and a railway linking the project to the port of Kribi, 860 kilometers away. The expected bauxite output is 4.5 million tones to 9 million tonnes per annum.

Cobalt

Toronto listed Geovic owns 60% of a nickel cobalt manganese project in Nkamouna in eastern Cameroon. Geovic expects to produce 4,200 tonnes of cobalt per year and 2,100 tonnes of nickel per year for 21 years. But Geovic said that in early 2009 production would be delayed until 2012 and investment was cut to USD 250 million from USD 370 million.

Iron Ore

1. Australia's Sundance Resources has an exploration permit for the Mbalam deposits. Sundance was scheduled to begin exporting iron ore from its USD 2.46 billion project by 2011 but the firm is involved in tax wrangles with the government and announced in November that production would be delayed to 2013 due to the global slowdown. Reserves are estimated at roughly 2.5 billion tonnes including 2.325 billion tonnes of itabirite hematite and 215 million tonnes of high grade hematite.

Once operational, Sundance hopes to produce some 35 million tonnes of ore per year bringing in USD 5 billion in royalties, taxes and dividends during the 25 year life of the mine.

2. The UK's African Aura Mining Inc is exploring its 100% owned Nkout iron project located at Djoum in southern Cameroon, adjacent to Sundance's Mbalam project.

3. Australia's Legend Mining Limited in September 2009 acquired 90% interest in 2 exploration permits covering an area of approximately 2,400 square kilometers after it obtained 90% ownership of Camina SA.

Uranium

1. Nu Energy Corporation is exploring for uranium in 2 sites in the north and the south of the country. After initial positive results in September, the firm is planning a follow up 2,000 meter drill program in the Kitongo project in the north.

Gold

African Aura Mining Inc is drilling at the Kambele prospect of its 100% owned Batouri gold exploration licence in the East region where the company has recorded visible gold in 25 out of 44 holes drilled.

Diamonds

C&K Mining Inc is due to begin mining in 2010 with output to be 1 million carats in the first year and expected to reach 6 million carats a year at peak production.

Oil

1. UK Sterling Energy has the offshore Ntem block in the Kribi Campo sub basin where it says it has identified four prospects with a cumulative potential in excess of 1.5 billion barrels. Sterling is seeking farm in partners.

2. China's Yan Chang Logone Development Holding Company Limited has signed USD 62 million production sharing contract to explore for oil on the onshore Zina and Makary blocks in the North.

3. Malaysia's Petronas PETRA.UL and Noble Energy have USD 119 million deals to explore for oil on the Tilapia block offshore the Douala/Kribi Campo basin which has estimated reserves of 40 million barrels to 70 million barrels.

4. France's Total E&P and Swiss firm Glencore are operating separate explorations offshore in the Rio del Rey basin. Total's Dissoni field in the basin start in 2011 with 15,000 barrels per day. Glencore and South African based Afex Global Limited signed USD 38 million deals for oil exploration on the Matanda block offshore the Doual/Kribi Campo basin.

Gas

1. Cameroon has gas reserves estimated at over 500 billion cubic meters and Franco and Belgian group Suez Global LNG Limited has signed a memorandum of understanding with it to look into developing liquefied natural gas projects.

2. Victoria Oil & Gas Plc owns 60% share in the Logbaba gas and condensate project located in Douala. The company has 4 exploration wells and plans to apply for 35 year exploitation and exploration licence. It said that on November 16th 2009 it discovered gas sands on the site that could boost the field's reserves.

Power

1. Cameroon plans to spend some 6 trillion CFA francs to increase electricity output from 1,000 MW to 3,000 MW by 2020 through construction of hydroelectric dams and thermal power plants. More than half of the planned increase in power capacity depends on the construction of the proposed Lom Pangar dam to control the flow of the Sanaga River.

2. Lom Pangar dam: Most studies completed as of 2009 and financing secured but construction schedule still unclear. The project in the East Region of Cameroon is designed to regulate the flow of the Sanaga River increasing output from downstream hyrdro electric plants and allowing construction of new ones.

3. Nachtigal 300 MW hydro power station: Construction of project at Nachtigal on the Sanaga River some 60 kilometers north east of Yaounde depends on the Lom Pangar dam.

4. Song Mbengue 930 MW hydro power plant: Construction of dam and power station near Edea depends on Lom Pangar dam.

5. Memve'ele hydropower station: Chinese construction company Sinohydro to start building 200 MW hydropower project in southern Cameroon in March 2010 with startup seen by end 2014. The cost is estimated at EUR 556 million.

6. Kribi 216 MW gas fired power plant: Construction of plant in southern coastal Cameroon to begin in early 2010 and start up in by end 2012. The cost is estimated at 122 million euros.

7. Yassa 86 MW heavy fuel power plant: Construction of the plant at Dibamba 20 kilometers east of economic capital Douala is nearly complete and startup could happen by end 2009. The cost of the plant is estimated at USD 105 million.

Ports

1. Douala handles 95% of the import and export traffic from Cameroon as well as land locked neighbors Chad and Central African Republic but capacity is constrained by silting.

2. Negotiations are ongoing for a final selection of private partners for construction work to start in March 2010 at the USD 655 million new multi purposes Kribi deep seaport to accommodate larger ships. Cameroon is seeking foreign partners to build an $830 million second deep seaport at Limbe in the south west.


Reuters
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