Aguia to acquire Brazilian phosphate projects
THE BOURSE WHISPERER: Australian potash and phosphate-focused exploration and development company Aguia Resources has signed an Option Agreement to acquire, what it describes as, two potentially large-scale phosphate projects located in the state of Rio Grande do Sul in southeast Brazil.
Aguia has an exclusive option to acquire 100% of the Tres Estradas and Joca Tavares carbonatite style phosphate projects from Companhia Brasileira do Cobre.
According to the company the projects show early stage signs similar to the carbonatite style hosted phosphate deposits mined by Vale within Brazil.
These include the Araxa (Reserve: 88.7 million tonnes at 11.12% phosphorous) and Cajati (Reserve: 85.1 million tonnes at 5.45% phosporous) operations.
Surface rock chip sampling carried out at the respective projects has returned high grade phosphate mineralisation including 31.70%, 25.80% and 22.90% phosphorous at Tres Estradas and 11.40% phosphorous at Joca Tavares.
Three historical diamond drill holes undertaken at Tres Estradas intersected carbonatite host rocks and returned wide zones of low grade phosphate mineralisation within the primary zone.
The top 15 metres of each hole was not sampled and Agui considers potential exits for higher grade shallow oxidised zones as indicated by grab surface rock samples.
The Tres Estradas project has a drill ready target zone extending for over one kilometre with thicknesses up to 100 metres.
“The defined nature of the carbonatite targets will allow Aguia to test the TE target quickly through drilling within the next few months,” Aguia Resources managing director Simon Taylor said in the company’s ASX announcement.
“We see enough encouragement from initial surface sampling and historical drilling to warrant a drilling program to test the TE target over a length of one kilometre.”
Aguia said the phosphate projects compliment the company’s Brazilian phosphate and potash projects and will enable it to capitalise on the increasing demand for fertilisers as it aims to be a developer in the Brazilian fertiliser sector.
The commercial terms of the Agreement allow Aguia the option to acquire 100 per cent of the projects through:
– Minimum commitment of a 600 metre diamond drilling program within 24 months;
– Has the right to conduct exploration on the projects for a term of up to 36 months (Option Term);
– Aguia can elect to acquire the Projects through the issue of 5,000,000 fully paid ordinary shares at any time up to 120 days after the expiry of the Option Term.
– In addition CBC retains the first right of refusal to purchase, at market prices and conditions, any future calcium carbonate production as a sub product from phosphate production.
– The projects being acquired are located within the Brazilian border control zone (150 kilometres from the international border) restricting foreign ownership of the tenements to 49%. Should the option be exercised to acquire the tenements at the conclusion of the exploration program, the company will be required to enter into a joint venture with a Brazilian owned company to develop the tenements. This arrangement is not expected to materially alter the company’s potential economic return on the funds invested as part of the exploration program.