Permit renewal sets up AKORA’s Bekisopa iron ore play for success

• Madagascar’s Mines Ministry has renewed the main tenement for AKORA’s Bekisopa iron ore project
• Renewal confirms commitment to expand exploration and mining in the country
• Application for renewal of northern tenement submitted

Special Report: AKORA Resources can progress its Bekisopa iron ore project in Madagascar with confidence after the main tenement was renewed by the Mining Ministry.

The renewal of PR 10430 is hugely positive for AKORA Resources (ASX:AKO) as the tenement hosts the inferred resource of 194.7Mt – as well as the high confidence indicated resource of 8.5Mt at 55.4% iron.

From this resource the average Life of Mine (LOM) Lump product grade is 62% Iron (Fe) and Fines product grade is 61%Fe over an initial six-year mine life, as described in the PFS.

This resource underpins AKORA’s recently announced pre-feasibility study into a 2Mtpa direct shipping ore operation which features a low operating cost of US$42/t and pre-tax cash flow of US$310m using a long-term benchmark iron ore price of US$100/t, with a payback of just 1.8 years.

Over the initial six-year mine life, the DSO operation will deliver positive NPV of US$147m and an IRR of 86% from an initial capital investment of US$61m.

It will also support development of the potential Stage 2 green steel zone to produce a low-impurity, premium-grade >67% iron concentrate.

Watch: High margins and momentum for iron ore flagship

Madagascar mining support

PR10430 was the first tenement to be renewed under Madagascar’s updated Mining Code with the company saying it confirmed the government’s commitment to develop its exploration and mining industry.

Tenement renewals had been on hold prior to the update of the Mining Code and supporting mining implementation procedures.

“We had confidence that the AKORA Bekisopa tenements would be renewed,” managing director Paul Bibby said.

“The Madagascan Government updated the Mining Code, delivered revised Implementation Procedures, and is now processing the ‘first 100 tenement renewals’.

“It’s a significant step change for the Mines Ministry which is committed to the expansion of exploration and mining in Madagascar.

“We’re extremely pleased that Bekisopa’s main exploration tenement PR10430 was the first to be renewed under the updated Code. This is another major milestone for AKORA and we will now complete the necessary requirements and submit the application for the transformation of PR10430 into a Mining Permit.”

The company has submitted PRE3757 on the northern section of the Bekisopa project area for renewal and expects the application to be processed in the next batch.

AKORA will also move to complete work activities to enable PR10430 to be submitted for transformation to a mining permit and continue discussions with the Mines Ministry and other key government ministries to advance the Bekisopa project.

Listen: AKORA on steel rails for Bekisopa iron ore development

This article was developed in collaboration with AKORA Resources, a Stockhead advertiser at the time of publishing.

This article does not constitute financial product advice. You should consider obtaining independent advice before making any financial decisions.