Ivanhoe Atlantic CEO Bronwyn Barnes is the guest speaker at the WA Mining Club event. PIctured is Bronwyn speaking at Optus Stadium in Perth
Ivanhoe Atlantic has made significant strides in its plans to develop iron ore resources in Guinea by securing a crucial rail agreement with the Liberian government. This deal, announced on July 8, 2023, facilitates the transport of iron ore from Ivanhoe’s Kon Kweni deposit in Guinea to a port in Liberia, marking a pivotal step in the company’s ambitions to compete in the iron ore market alongside established players.
The agreement allows Ivanhoe to initially transport up to 5 million tonnes of iron ore per year using existing rail infrastructure. This development comes as the company seeks to complete its initial public offering on the Australian Securities Exchange, a process that has faced delays pending governmental approvals in Liberia. The rail agreement is a key component in Ivanhoe’s strategy to leverage West Africa’s untapped iron ore resources, despite the region’s complex logistical and political landscape.
Details of the Rail Agreement
Ivanhoe Atlantic’s chief executive, Bronwyn Barnes, expressed optimism regarding the ratification of the rail agreement, emphasizing its alignment with the policy of Liberian President George Weah. The initiative aims to transition existing rail infrastructure into a multi-user system overseen by an independent operator. Barnes stated, “This opens up a valuable logistics chain to other users in Liberia and neighbouring countries, including US-aligned companies looking to expand into the region.”
The Liberian government’s statement indicated that Ivanhoe would gain the right to develop up to 30 million tonnes per annum (mtpa) of rail-port access capacity. In a significant upfront investment, Ivanhoe made a payment of $37 million to the previous administration for the rights. Future payments include $10 million due upon ratification and an additional $15 million once the company achieves physical access for Phase 1 operations.
Challenges Ahead
Despite these advancements, significant hurdles remain for Ivanhoe Atlantic. The company must ensure that the Liberian government honors agreements made in 2019, which previously permitted the transport of ore through Liberia before the construction of the Simandou railway network. Additionally, political opposition has emerged, including concerns from a Republican member of the US Congress regarding Ivanhoe’s connections to China.
Barnes has reassured stakeholders that none of the iron ore from the Kon Kweni deposit will be sold to China, aiming to allay fears about the project’s geopolitical implications. She also conveyed confidence that funding for necessary infrastructure upgrades, including a new port at Didier, will come from private investors and development finance institutions.
As Ivanhoe Atlantic moves forward with its plans, the company’s ability to navigate these challenges will be critical in establishing a foothold in West Africa’s burgeoning iron ore sector. The ongoing developments will be closely monitored by industry experts and investors alike, as the region’s potential continues to attract global attention.
