The company commenced mining iron ore in Sierra Leone in December 2010 and has since stockpiled material. Iron ore exports will start this month and African Minerals expects to export about 1.2 million tonnes of iron ore during the current fourth quarter.
Mr David Tucker its head of sales and marketing said "We have three cargoes programmed for China and one cargo programmed for Europe. He said that we are selling some trial cargoes, but really the intention is from those trial cargoes to cement long-term off-take agreements with partners."
He said that African Minerals is currently in talks with European Chinese and Asian steelmakers to sign more off take agreements. He added that we are not tied to a specific index but our initial contracts reference the Platts index."
He also said "We are talking about something which is linked to the China CFR price, but the actual pricing mechanism is a bit of secondary importance to us."
Shandong Iron & Steel, the world ninth largest steel group has already agreed to pay USD 1.5 billion for a 25% stake in African Minerals' flagship iron ore project and will take 25% of its production. Mr Mike Jones head of corporate development and investor relations said to go ahead, the deal still requires Chinese government approval, which is expected by December 31.
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