On January 13, Canadian-based International Gold Mining Limited announced that it has entered into a heads of agreement to acquire 100 percent of Western Australia-based Swan River Minerals Pty Ltd.
Under the agreement signed with Swan River on January 13, International Gold Mining Limited has the exclusive right for 180 days to carry out due diligence on the E29/696 iron ore tenement held by Swan River. The consideration for the transaction is six million shares of International Gold Mining on settlement, subject to successful due diligence and regulatory and shareholder approval as is necessary.
The E29/686 iron ore tenement consists of 70 sub-blocks and is located within the Yilgarn iron ore province of Western Australia which is considered highly prospective, given its history of large-scale iron ore production, with the Koolyanobbing operation currently producing at a rate of about 5 million mt per year of direct shipping ore.
According to the announcement, a number of other companies are currently exploring the province for both direct shipping ore and magnetic deposits. Aspiring Australian iron ore producer Polaris Metals NL has identified a target resource of over 100 million mt of direct shipping iron ore mineralization. The province is considered a consolidation opportunity given that Polaris has successfully been taken over by Australian mining services and contracting company Mineral Resources Limited in a AU$160 million cash/share transaction.