THE BOURSE WHISPERER: Perth-based Magnum Mining and Exploration has entered into an option and exclusivity agreement to acquire an iron ore project in Minais Gerais, Brazil.
OCRA Trustees (Seychelles) Limited as trustee of Global Trust has granted Magnum an irrevocable exclusive option to acquire all of the fully paid issued shares in Irongates (Aust) (IAPL).
IAPL holds 100 per cent of the issued capital in Gates Minerals (GMPL) as well as 99% of Irongates Brasil Recursos Minerais (IBRML), a company registered in Sao Paulo.
GMPL also holds the remaining one per cent in IBRML.
IBRML holds contractual rights to acquire Emicon Mineracao Terraplenagem Ltda’s (Emicon) Brazilian iron ore project, the focus of Magnum’s acquisition.
The Brazilian iron ore project is located in the south western portion of the renowned “Iron Quadrangle” in Serra Azul in the state of Minas Gerais, Brazil.
“The Iron Quadrangle is an important iron mining region and one of the most important metallogenic provinces in the world and has been mined for iron ore since the nineteenth century,” Magnum Mining said in its announcement to the ASX.
The Brazilian iron ore project consists of an in-situ exploration project and a sinter feed project containing alluvial tailings.
Magnum said that it considers the alluvial nature of the sinter feed fines of the Sinter Feed Project present an early production opportunity for the company.
The Brazilian iron ore and Sinter Feed projects are both located in close proximity to Brazil’s MRS railway network, providing excellent infrastructure logistics to major ports located off the coast of Rio de Janeiro and São Paulo.
Magnum has already commenced comprehensive due diligence investigations in respect of the Brazilian iron ore and Sinter Feed projects.
Magnum has until January 2012 to exercise the option, subject to it being satisfied with its due diligence investigations on the two projects.
In consideration for the grant of the option, Magnum has paid OCRA an option fee of US$200,000.