Iranian Private Consortium Signs $1b Lead-Zinc Deal
EghtesadOnline: A consortium of Iranian private companies has signed a deal worth $1 billion with the Iranian Mines and Mining Industries Development and Renovation Organization to develop one of Iran’s largest lead and zinc mines.
According to IMIDRO Chairman Mehdi Karbasian, the consortium is made up of Iran Lead and Zinc Industries and Mining Association and six private companies, led by Mobin Mining and Construction Company.
Mehdiabad Mine is a world-class oxide, sulfide and mixed oxide/sulfide zinc, lead and silver deposit. It has 154 million tons of proven and up to 400 million tons of estimated reserves, 70% of which are zinc and the rest are lead, silver and barite.
According to IMIDRO, the mine’s reserves can reach up to 700 million tons through further explorations.
According to Financial Tribune, operations at the mine started several years ago after a joint venture was formed between the Australian company Union Capital Limited and mining and engineering company Iran ITOK. But after the two investors ran into disagreements with the government over the details of the deal, operations in Mehdiabad came to a halt.
“This project was stagnant for over two decades … Its lack of progress brought us to look for new investors,” IMIDRO public relations quoted Karbasian as saying.
Based on the new deal, the consortium is set to operate the mine for the next 25 years. It is expected to establish two plants producing zinc, and lead and silver concentrate with an annual output capacity of 800,000 and 80,000 tons respectively in four years.
According to Bahram Shakouri, Mobin’s managing director, his company is already holding talks with foreign and local partners for marketing the products and is discussing cooperation with Swiss and Spanish firms to further develop the mine.
Mehdiabad Mine is of utmost importance to the Iranian lead and zinc industry, as it is the country’s only major source of the minerals.
For years, lead and zinc producers relied on Angouran Mine located in Zanjan Province to provide their feedstock. Angouran is one of the oldest mines in the country, extraction from which dates back to the 1960s. Years of exploitation have depleted the mine’s reserves.
According to Angouran Lead and Zinc Complex’s Manager Mansour Sheibani, only about 9 million tons of minerals are left in the mine, 2 million tons of which are in underground reserves while the rest are on the surface.
“With the current annual extraction rate of 750,000 tons of minerals, the mine will be exhausted by 2027,” he said.
Global zinc production currently stands at 13 million tons per year with Iran accounting for about 1% of the figure, making it the world’s 19th and Asia’s seventh largest producer of the metal.
Experts believe that the industry has the capacity to boost production, considering Iran’s sizable zinc reserves.
This is while Iranian zinc smelting plants are currently using only 150,000 tons of their 450,000-ton production capacity, according to the head of Iran Lead and Zinc Exporters Association.
Hassan Hosseinqoli also said the lack of feedstock has caused zinc smelters to operate at 33% of their actual capacity.