Ann: High Grade Resource at Minim Martap, page-36

from KPMG Cameroon Country Guide 2014

Bauxite • Cameroon Alumina Limited (CAL) – a joint venture between Hydromine, Dubai Aluminum Company andHindalco Industries – is developing an 8.5 million tons p.a. bauxite mine at Ngaoundal and Minim-Martapand a 3 million ton p.a. aluminum refinery. The project is expected to be implemented in two phases. Thefirst phase involves setting up a 4.25 million tons p.a. bauxite mine and a 1.5 million tons p.a. aluminarefinery, which would be expanded to 8.5 million tons p.a. and three million tons p.a. subsequently.• The project cost for Ngaoundal and Minim-Martap is estimated at $4 billion - $6 billion and according toCAL, the project will create around 7,000 direct and 6,000 – 8,000 indirect jobs during the peak of theexecution phase, and around 1,500 – 2,000 direct, and 4,000 indirect jobs during the operation phase.

from Freightline 2 – Australian iron ore freight transport

For rail, BITRE assumed average rail transport costs of between 1 and 2 c/ntkm (cents per net tonnekilometre) for Pilbara railways and slightly higher costs elsewhere. This estimate includes the empty backhaulcomponent. The estimates are based roughly on those of Laird et al. (2005) who reported average operatingcosts of around 1–2 c/ntkm (cents per net tonne kilometre) for Pilbara iron ore railways (Laird et al. 2005,p. 3) and 2.5 c/ntkm for other bulk railways. The low average operating cost of Pilbara rail networks areattributed to world class track (good alignment, excellent formation, complete with sleepers and weight ofrail capable of high axle loadings), up-to-date locomotives and well-maintained wagon fleets, as well as highaverage energy efficiency (e.g. 0.002 litres of diesel per 1 tonne kilometre of iron ore). Pilbara Infrastructure’s(2008) submission to the National Competition Council (NCC) also estimated average rail operating costs inthe Pilbara of around 1 c/ntkm. For other iron ore rail operations, BITRE assumed slightly higher averagetransport costs.

It is highly unlikely that the economy and efficiency of the Pilbara rail network will be realised at 10 Mtpa in Cameroon. In addition, bauxite is a low density mineral and so more costly to transport than iron ore.

Does anyone believe the diesel consumption figure? Two millilitres of diesel are all that is required to move a tonne of rock a kilometre. My car uses 40 millilitres per tonne per kilometre. More likely 20 millilitres I reckon but I stand to be corrected; perhaps its all downhill and virtually no rolling resistance with the return journey not counted.

from Technology andSupply Chains forCritical IndustriesResources sector(Working paper 1 of 3)...

Supply chain costsSupply chain costs are driven by mode and the standard of the infrastructure used. The costof transporting coal is estimated to be 15 cents per net tonne kilometre (c/ntkm) by road, 4.1c/ntkm by rail and roughly 1.4 c/ntkm by sea. The rail haul costs in the iron ore sector areestimated to be lower than coal (between one and two c/ntkm) as result of higher standardtrack, locomotives and wagons, higher volumes and higher iron ore density. Information forbauxite was not available but costs are likely to be similar to those of the coal industry.Publically available information on supply chain costs is generally limited due to commercialsensitivities.

https://www.rome2rio.com/map/Douala/Ngaound%C3%A9r%C3%A9

Douala to Ngaoundere by rail is 883 km less 80 km to Minim Martap less 70 km from Douala to Edea plus 130 km from Edea to Kribi = 860 km. This ignores any rail spurs built into the mining areas which are up to 80km from the existing rail.

Let's say rail freight will cost AU$0.04 per dry tonne per kilometre in Cameroon then rail haulage will cost...

860 x 0.04 x 0.75 = US$26 per dry tonne.

Why is mining cheaper in Cameroon? Labour will be significantly cheaper and power too but how will efficiencies compare? Does anyone have any mining cost data? Barricks's costs in Tanzania look like Australian costs, AU$5-6 per tonne for open pit mining from the 2014 NI43-101 for Lumwana at 50 Mtpa.

Me I'd tend to turn the current Metro site cost into US$ and adjust for scale (33% fixed costs = $24 per wmt x 2 Mtpa x 33% = $16M)...

Assume the moisture content = 5%.

(AU$24 x 67% x 10 Mtpa + $16M) / 10 Mtpa x 0.75 / 0.95 = US$14 per dry tonne.

Road haulage or a conveyor network will be required to transfer the ore from mine site to rail loading facility as the deposits are extensive.

Sea freight costs...Metro Mining to Shanghai is about 3,500 nautical miles. Douala to Shanghai is about 11,900 nautical miles.Metro Mining have $17 per wmt for freight. If half of this is transshipment and handling then it's going to cost...

17 / 2 x 0.75 x 11900 / 3500 / 0.95 = US$23 per dry tonne.

All up that's US$63 per dry tonne.