Construction work on this project, for which the initial investment is estimated at $32.7 million including working capital, is scheduled to be commenced in the third quarter of 2007 and to be completed within a one-year period.
In addition, Eldorado has renegotiated the terms of its 50-50 percent joint venture agreement with Brazilian company DSI Consult (DSI), which owns a mining license for the Vila Nova deposit. As a result, Eldorado has increased its share in the JV company to 75 percent at the cost of $2.8 million. In addition, Eldorado has agreed to provide $30 million of the project's pre-production capital expenditure.
According to a pre-feasibility study conducted by Eldorado, the Vila Nova iron ore deposit has approximately 9.272 million metric tons of both proven and probable reserve ROM (Run of Mine) with an average content of 61 percent Fe.