Arrow, Baosteel MoU unlocks Simandou multi-user railway

Arrow Minerals (ASX: AMD) has signed a non-binding MoU with Baosteel to deliver Arrow’s iron ore to steel mill customers.

The framework includes provision for all key commercial elements including iron ore pricing, freight, ore haulage, ore handling, ship loading and government royalties related to Arrow’s Simandou North iron project in Guinea.

Arrow managing director David Flanagan says this is an important milestone for Arrow, the Simandou North iron project and Guinea.

“The delivery of multi-user infrastructure will continue to attract significant global investment which in turn will promote the growth of a world class mining industry,” he said.

“That will result in globally competitive operations, substantial local employment and extensive national benefits.

“It has taken millions of man-hours, billions of dollars and thousands of pages of contracts for all the joint venture partners, including BaoWu Group, to develop the Simandou iron project, which is due for commissioning in late 2025.

“It is important to recognise the significant role that the Guinea Government has played in ensuring that this infrastructure is delivered as a ‘multi-user’ facility that has the potential to support numerous industries and provide substantial benefits to Guinea.

“Blocks 1 and 2, as part of Simandou iron project, are directly adjacent to Arrow’s Simandou North iron project which creates real operating synergies due to their close proximity.

“Future mine gate sales will deliver Arrow clear access to markets for our product and optimal alignment with our nearest neighbour.

“Since commencing field activities at our Simandou North iron project in 2023, Arrow has completed 521 holes for a total 10,309m, culminating in an exploration target announcement and the intention to move to resource drilling and scoping studies in 2025.”

The exploration target for the Simandou North iron project is estimated between 281-716mt of Simandou formation oxide banded iron formation (BIF), at 33-46% iron.

Arrow is encouraged by the preliminary metallurgical test work undertaken on the same mineralisation which achieved a 61-64% iron, low alumina (<0.5%) hematite fines product from a simple wet gravity process.

In contrast to Pilbara iron ore beneficiation processes, where most are seeking to reduce alumina and silica in the final product, for this project the beneficiation process is only about reducing silica in the final product, as the mineralisation of Simandou formation oxide BIF is naturally very low in alumina.