Eramet, the French mining and metallurgical group, and Mineral Deposits Ltd. (MDL) announced on June 20 the signing of a memorandum of understanding for the creation of a joint venture to combine Eramet Titanium & Iron (ETI), which operates the Tyssedal titanium slag and high-purity pig iron plant in Norway, and MDL’s Grande Côte Mineral Sands project, located in Senegal.
“The combination of ETI with Grande Côte would create a new major player in the mineral sands (titanium dioxide and zircon) industry and would give the new entity the option to become a vertically integrated titanium feedstock producer, with the Tyssedal plant benefiting from a new source of high-quality ilmenite, while Grande Côte would be able to secure the sale of most of its ilmenite production,” the statement said.
Under the terms of the memorandum, Eramet and MDL enter into exclusivity arrangements to finalize formal documentation under which Eramet and MDL would each hold 50% of the shares of the joint venture. Eramet would contribute 100% of its shares in ETI and $30 million in cash to the joint venture, and MDL would contribute its 90% participation in the Grande Côte Mineral Sands project, the other 10% of the project being held by the Republic of Senegal. The companies plan to finalize formal documentation by the end of July 2011 and to complete the formation of the joint venture by the end of September.
ETI is a 100%-owned subsidiary of Eramet. The Tyssedal plant in Norway has capacity to produce 210,000 mt/y of titanium dioxide slag for use in the white titanium pigments industry. ETI is the only European producer of slag and is a major consumer of ilmenite. An important co-product of this activity is high-purity pig iron (120,000 mt/y of capacity), which is sold to ductile iron foundries, notably for the production of wind mill parts.
MDL is based in Australia. Its Grande Côte project on the coast of Senegal is expected to have a mine life of at least 20 years based on identified reserves and resources and is anticipated to produce on average about 85,000 mt/y of zircon and 575,000 mt/y of ilmenite, as well as small amounts of rutile and leucoxene. Construction of the project is expected to begin in the third quarter of 2011, and production is expected to begin in late 2012 or early 2013.
