Company sources say exclusive agreement would be finalized next April with anticipated re-rating.

Sundance Resources Limited (SDL), an Australian firm partnering with which Cam Iron to develop the multi-billion Mbalam Iron Ore Project in the East Region, announces the reception of several tenders for rail and port infrastructure from Chinese and non-Chinese Engineering, Procurement and Construction (EPC) contractors with demonstrable capabilities and financing capacity.

“We believe that there is a real chance that the port and rail infrastructure will be either predominantly funded by facilitated debt and partial asset sales, or (better still) constructed under a build, own, operate and transfer (BOOT) contract that will relieve SDL of the burden of financing around 80 per cent of the initial project capital expenditure,” a statement on the website of the company reads.

The finalisation of an exclusive agreement on the port and rail infrastructure, the statement notes, is expected in April 2014 and there is anticipated major re-rating of SDL’s share price to more closely align it with its $0.26/share valuation. “The Company is now engaging in detailed negotiations with a view to finalising an exclusivity agreement with the successful EPC proponent by the second quarter of 2014,” the statement further states.

After signing the mining agreement with the government of Cameroon on November 29, 2012, Cam Iron was given 18 months to mobilise the project’s finances (4.7 billion dollars needed for the first phase). The project is expected to produce 35 million tons of iron ore per annum and generate royalties to the tune of 600 billion US dollars in 25 years.

Cam Iron also will construct a 510-km rail line for the transportation of iron ore from the Mbarga Mine to the Cameroon coast with a 70-km rail spur line to connect to the Nabeba Mine in Congo. It will also build a deep water iron ore export terminal in Lolabe-Kribi capable of taking bulk “China Max” iron ore carriers.