Uganda’s First Iron Ore Smelter to start commercial production 2011

By Nicholas Bariyo | KAMPALA Uganda -(Dow Jones)- Alam Group of Companies is constructing an iron ore Smelter in Uganda’s Jinja district which is expected to start production in October, company officials said Friday.
According to Abid Alam, the manufacturing, building and construction company’s managing director, the company is developing the plant in a phased manner, investing an initial $13 million with the capacity to produce 150 metric tons of sponge iron per day, this will be doubled to 300 tons a day in the second phase.

“Initially, the plant will use materials from the Kigezi region in South Western Uganda,” he said, adding the company is looking at tapping into the hematite iron ore which is readily available in the country.
Company officials said the entire project will be completed by the end of 2012.
According to Alam, the plant will initially be importing coal from South Africa to smelt the iron ores. However, the company plans to substitute the coal with natural gas, when Uganda starts oil and gas production in the next couple of years to ease production costs.

Uganda has confirmed huge iron ore reserves in its south western parts along the border with mineral-rich but lawless eastern Congo, according to the department of geological survey and mines.
Last year, the department completed a $44 million geophysical aerial survey across the country and has since gathered enough geological data which is being used to lure mine investors, according to government officials.

By Nicholas Bariyo & contributing to Dow Jones Newswires; 256-75-2624615 bariyonic@yahoo.co.uk