Vanguard Mining Corporation has signed a Memorandum of Understanding with Golden Card Memong, a Cambodia-based company, to increase its sand supply for local and export markets.
Vanguard and Golden Card will set up a joint venture enterprise to excavate and sell the sand from a mine with estimated 200 million cubic meters of sand deposits in Stung Hau District, Kam Pong Saum Province, Cambodia.
At the average price of S$21.23/m3, this mine could amount up to S$4.2 billion in total sale, or equivalent to US$ 3.3 billion. At US$2.50/m3 net profit, this mine could potentially produce US$500 million in net profits over its lifetime.
Vanguard Mining will be responsible for securing long-term overseas buyers for the sand produced from the mine, especially Singapore.
Historically, Singapore’s land area has increased from 581.5 square kilometers (224.5 square miles) in the 1960s to more than 700 square kilometers today. The government also plans to grow the country by another 100 square kilometers by 2030. Almost all of this land reclamation has been undertaken using sand imported from nearby countries.
The country also needs vast volumes of sand for its massive construction industry, the result of an ongoing property boom in which any building over 10 years of age is potentially at risk of being demolished and replaced by an even larger one.
Sand traders estimate that Singapore is currently importing sand at a rate of 200,000 tonnes per day.
Tenders have been put out for another 21 million tonnes of sand, but this is only a drop in the ocean when taking into account the overall land-reclamation projects planned up until 2030. The upcoming Tuas Finger 1 project alone is expected to require one billion tonnes of the product.
Cambodia has exported sand to Singapore before but has encountered problems involving environmental protection and quality control. VNMC intends to overcome these hurdles by strictly adhering to international environmental protection requirements and implementing a tight quality control system.