Zinc Ore Mining and Export in Nigeria; The Pre-Feasibility Report.

Zinc is the 24th most abundant element in the earth’s crust and is a metallic chemical element with symbol Zn and atomic number 30.

In the raw form, there are two grades of Zinc Ore, high and low. The low grade is usually from 10%- 40% and high grade from 50%-90%.

The major uses of zinc are anti – corrosion coating on steel {Galvanizing}, precision components {die casting}, construction materials, brass production, pharmaceuticals and cosmetics

Demand for lead and zinc was low during the late 2000s due to a global recession. According to the U.S. Geological Service, U.S. industrial minerals mine production declined by 18 percent in 2009 to $35.8 billion. However, American Metal Market announced shrinking lead and zinc surpluses in July 2010 as demand for surpluses increased, according to a report by the International Lead Zinc Study Group (ILZS).

In addition, in May 2010, lead mining production rose by 4.6 percent compared to the previous month, and refined lead production increased by 2.2 percent. Global demand for lead increased from January to May by 3.6 percent, indicating a recovery of a sagging economy. Over the first five months of 2010, zinc surpluses fell by nearly 20 percent.

Worldwide zinc production was up over the first five months of the year by 14 percent, compared to the same period of the previous year, and global demand for zinc was up by over four percent.

The market for zinc ore is both local and international with china as the largest importer of metal ore in the world. Because of the various applications of zinc ore, the demand would always surpass the supply.

The United States imports over 75 percent of its zinc demand. The U.S. supply of zinc comes primarily from Canada (55 percent) as well as Peru (15 percent) and Mexico (15 percent).

The prospect of global economy is promising, so the automotive market, which is closely related to the zinc ore market, is witnessing growth thereby creating more demands for the product.

It is estimated that Nigeria has over 10,000,000 tons of zinc ore deposit and it is an important component in car battery production. The prospect of global economy is promising, so the automotive industry which is closely related to the lead market, is witnessing growth thereby creating more demands for the product.

This report seeks to examine the financial viability or otherwise of mining zinc ore in Nigeria and export of same (zinc ore 40%).

The business entails using mechanized method of mining to produce five hundred (500) tons bi-monthly of zinc ore rocks of which minimum of three hundred (300) tons of zinc ore 40% will be extracted from the rocks after sorting.

Table of Contents

EXECUTIVE SUMMARY 1. Business Overview 1.1 Description of the Business 1.2 Incentives / Government Policy 1.3 Obtaining a Mining Permit in Nigeria and Associated fees 1.4 Occurrence and Distribution of the mineral in Nigeria 1.4 Critical Success Factor of the Business 1.5 Description of the Business Industry 1.6 Contribution to Local and National Economy 2. Marketing Plan 2.1 Description of product 2.2 Location 2.3 The Opportunity 2.4 Legal Requirement 2.5 Pricing Strategy 2.6 Target Market 2.7 Distribution and Delivery Strategy 2.8 Promotional Strategy 2.9 Competition 3. Technical Analysis 3.1 Description of the Location 3.2 Raw Materials 3.3 Production Technology / Equipment 3.4 Production Process 3.5 Production Cost 3.6 Stock Control Process 3.7 Pre-Operating activities and expenses 3.7.1 Operating Activities and Expenses 3.8 Project Implementation Schedule 4.0 Organizational and Management Plan 4.1 Ownership of the business 4.2 Profile of the promoters 4.3 Key Management Staff 4.3.1 Strategic Business Units 4.3.2 Management Support Units 4.4 Details of salary schedule 5. Financial Plan 5.1 Financial Assumption 5.2 Start – up Capital Estimation 5.3 Source of Capital 5.4 Security of Loan 5.5 Loan Repayment Plan 5.6 Financial Projections 6.0 Business Risk and Mitigation Factor 6.1 Business Risks 6.2 SWOT Analysis 7.0 Managing contract negotiation and Export Operations

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