In March 2025, four key workstreams were identified, which have the potential to result in high-impact value improvement outcomes for the Zanaga Project.
- Product Quality Enhancements – Direct Reduction Iron
- Pellet Plant Feasibility Study
- Single 30Mtpa capacity pipeline Feasibility Study
- Dry Tailings Feasibility Study
1. Product Quality Enhancements – Direct Reduction Iron
Demand for premium products is driving a notable shift in the iron ore market, as the decarbonisation of the steel supply chain is expected to create a supply-demand shortfall for premium, higher-grade iron ore products, strengthening Zanaga’s strategic importance.
During Q2 2025, the company commissioned and completed a metallurgical laboratory test work programme aimed at determining the ability of the Zanaga Project to produce DRI grade pellet feed concentrate across its full 30 Mtpa planned production scale, including both Stage One (12Mtpa) and Stage Two (18Mtpa expansion).
Representative samples of the Zanaga Project resource were assembled from both hematite and magnetite orebody lithologies, required for the Stage One and Stage Two phases of the Zanaga Project respectively.
The primary test work programme was conducted in China, involving comprehensive laboratory analyses, employing magnetic separation and flotation processes. Adjustments to the Zanaga Project’s planned flow sheet resulted in the optimisation of process step configuration and, in some cases, replacement of certain processing equipment in the original flow sheet.
Product test work results from both hematite and magnetite orebody lithologies met stringent DRI quality requirements critical for the rapidly growing EAF steel sector:
| DRI Results (June 2025) | DRI Benchmark Quality2 | Rio Tinto New Iron Ore Specifications1 | ||
|---|---|---|---|---|
| Stage I 2024 FS | Stage II 2024 FS | RioTinto IODEX | ||
| %Fe | 68.5 | 69.1 | ≥67 | 60.8 |
| %Al2O3 | 0.47 | 0.40 | <0.5 | 2.5 |
| %Si2O3 | 1.05 | 1.96 | <2.0 | 4.3 |
| %P | 0.034 | 0.025 | ≤0.03 | 0.11 |
1 From Q3’25 for Pilbara Blend Fines (PBF) + Pilbara Blend Lump (PBL)
2 International Iron Metallics Association (IIMA), 2021
The ability to achieve DRI specification from the Zanaga Project’s ores has the potential to transform the value proposition of the Zanaga Project and increase the NPV (detailed assessment here), where significant price premiums could potentially create substantial upside value for the project.
These test work results represent a significant improvement in planned product quality versus the 2014 Feasibility Study, particularly in the reduction of impurities (gangue minerals).
Following the achievement of the positive results above, a separate independent confirmatory test work programme was completed in the United Kingdom, utilising a separate sample of the two orebody lithologies. The results from this confirmatory work validated the test work results conducted in China.
The Zanaga Project DRI test results fall squarely within or ahead of industry benchmarks for DRI feed. Both its hematite and magnetite concentrates have demonstrated to exceed the minimum DRI feed requirement of 66%-67%Fe, have low gangue (SiO₂ + Al₂O3) and ultra‐low impurities – highlighting their full technical compliance for DRI grade product quality.
Our achievement of enhanced DRI product quality provides a positive base for our ongoing value engineering work, including completing a feasibility study of a DRI grade pellet plant which would provide further optionality to enhance value by converting Zanaga’s pellet feed concentrate into premium quality DRI pellets.
Martin Knauth
Chief Executive Officer
2. Pellet Plant Feasibility Study
The Republic of Congo is striving to develop new industrial manufacturing capability. Natural gas and energy availability provides an ideal environment for the potential pelletisation of Zanaga’s high-grade iron ore products.
Forecast Price 2025 Real Basis CFR China US$/t1
1 Historical and price forecast from AME June 2025 for 65% Fe Pellet Feed China, 68% Fe DRI Pellet Feed China, and 68% Fe DRI Pellet China. Historical and price forecast from Bloomberg and Broker Consensus July 2025 respectively, for 62% Fe China.
Ability to produce DRI pellets will command a higher value for Zanaga Product
The Pointe Indienne Special Economic Zone (SEZ), under development by Arise (the Zanaga Project’s port development partner), is ideally suited for such industrial activity, adequately supported by excess power capacity from the neighbouring Centrale Électrique du Congo (CEC) power plant, with whom the company has executed a Memorandum of Understanding (MoU) to develop power solutions.
Further, the company has received interest from various groups in the Kingdom of Saudi Arabia and the United Arab Emirates (UAE) and is exploring these opportunities.
3. Single 30Mtpa capacity pipeline Feasibility Study
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Previously
Pipeline for Stage 1 was 12Mtpa
Pipeline for Stage 2 was 18Mtpa
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Now
Stage 1 is being assesed for 30Mtpa
An opportunity exists to construct a single, buried 30 Mtpa capacity pipeline for the Project’s Stage One, 12 Mtpa initial development. This would eliminate the need to build a second independent pipeline to support the Stage Two 18Mtpa expansion (to 30Mtpa total production).
This initiative would substantially reduce Stage Two capital costs, minimise environmental impact, enable the acceleration of Stage Two expansion, and streamline financing of Stage Two using Stage One cash flows.
The company is conducting a Feasibility Study to assess the capability to significantly reduce the costs of Stage Two, and substantially reduce the engineering, environmental, and social aspects of the Stage Two expansion project.
4. Thickened and Dry Tailings Study
A large wet Tailings Storage Facility (TSF) is currently planned for the base case staged development project. An opportunity exists to utilise thickened paste or filtered tailings technology to reduce moisture content, thereby providing significant benefits such as lowering long-term management costs (through reduced sustaining capex) and enabling a smaller TSF with a simpler operation and easier rehabilitation.
It is estimated that, if successful, this could deliver up substantial sustaining capex savings over the life of the mine. The company is conducting a Feasibility Study to evaluate the opportunity to make substantial capital and operating cost reductions from reduced water management and improved production efficiencies.