Three Algerian public institutions — Sonatrach (oil), Manal (mines) and Sider (steel) — on Monday signed a shareholding agreement for the creation of a society to exploit iron deposit found at Gara Djebilet, in Tindouf, a town in South-West Algeria.
The Algerian Ministry of Energy and Mines said in a communiqué that the share capitals of the companies are as follows: – National Society of Iron and Steel (FERAAL/SPA) 200 million dinars (about 2 million euros), shared among Sonatrach (55 per cent), Manal (25 per cent) and Sider (20 per cent).
The new society’s objective is to study, explore, transport, transform and trade iron and its derivatives from the deposits of Gara Djebilet and Mechri Abdelaziz.
“FERAAL/SPA will satisfy the needs of the Algerian iron and steel industry in raw materials and semi-finished products. All surplus will be exported,” said the communiqué.
According to a forecast by the Algerian Ministry of Energy and Mines, this project should generate about 15,000 jobs in its initial phase and 5,000 direct and 25,000 indirect jobs in its exploitation phase.
The government has disbursed US$ 15 billion to revive the iron deposit of Gara Djebilet, which was abandoned since 1975.
Exploitation of this deposit is expected to start in five years’ time. Iron deposit was discovered in 1953 and its reserves are estimated at 2 billion tons.
However, the exploitation will be costly to the government because of the distance of the area from the nearest port at Ghazaouert, in North-West Algeria, about 1,400 km.
About 2,5 million tons of iron is expected to be produced annually at this deposit.
It is also said that Algeria produces only 20 per cent or 700,000 tons of its needs in iron and steels that stand at 3 million tons. Its domestic needs is expected to reach 15 million tons by 2025.
Two groups, Sonatrach and Manal, have also created a second mining enterprise named National Society for Barium (BARYTAL) to supply the subsidiaries of Sonatrach that are active in the field of oil forage.
According to the communiqué, BARYTAL will study, develop, exploit and trade barium from the deposit at Draïssa, situated in Béchar and other minerals that go into the composition of forage fluids from other different deposits.
About 3 billion dinars or 30 million euros will be invested in this project that will generate 300 direct jobs.