Crusader announced this week it will sell 100 percent of its Posse iron ore mine, located in the city of Caete, in the state of Minas Gerais, to Inter Invest BP S/A for a combined BRL 8 million ($2.5 million). The Canada-listed company will receive the total amount over a period of 17 months.
“The sale is conditional on Crusader receiving the first payment of BRL 1 million on or before August 10, 2017. Remaining funds will be received in 15 equal monthly payments of BRL 467,000, commencing 60 days from the effective date of the sale agreement (August 1, 2017),” Crusader said in a statement.
The Posse iron ore mine produces about 1 million mt of iron ore per year.
Crusader said Inter Invest is “looking to build an iron ore business and have the capital to invest in the ongoing development and extraction of the significant itabirite ore present at [the] Posse [mine].”
Crusader said the asset sale will allow it to leave the iron ore business, so it can focus on the gold business.
“Posse has been an outstanding asset for Crusader,” said Crusader’s managing director Rob Smakman, who labeled the Posse operation as “profitable” since it started producing in 2013.
Crusader said the mine will be transferred to Inter Invest “over the coming months.” It also said the new owner should keep existing jobs.
“Crusader understands that it is Inter Invest’s intention to retain the existing Posse employees and continue with the operation’s various current active contracts. Inter Invest has accepted liability for past and future environmental issues including the ultimate closure costs and rehabilitation management,” the company said.