Sundance says Cameroon project costs increasing

Australia's Sundance Resources wants Chinese companies to build a railway line and port in Cameroon vital to its Mbalam iron ore export venture, a senior executive said on Tuesday.

The project is also expected to cost more than the $3.4 billion initially thought, managing director Giulio Casello told an African mining conference.

He said agreements had been signed with China Rail and China Harbour to build 490 km of rail line linking two mines in the Mbalam area to a port on the Cameroon coast capable of handling 35 million tonnes of ore a year for a decade.

The initial capital costs were pegged at $3.4 billion but the figure was likely to increase due to the addition of the Nabeba mine in Congo Brazzaville, he said.

The Nabeda mine would need 60 kilometres of railway line and a crushing and sorting facility, he said.

Mbalam, Sundance's main project, is among a handful of big iron ore developments in west and central Africa and is seen as a cornerstone of Cameroon's effort to diversify its largely oil-dependent economy into mining.