Australian mineral resources explorer Fe Limited (Fe) has announced that it has entered into an agreement for the acquisition of iron rights from Dempsey Resources, a subsidiary of Australian mineral investment company Cape Lambert Resources, covering 9.5 km of strike of banded iron formation at Mt Ida in the iron ore-rich Yilgarn province of Western Australia.
Pursuant to the terms of the agreement, Fe will acquire the iron rights to an area of 371 square kilometers - the Mt Ida iron project - for $50,000 and a production royalty of $1 per metric ton of iron ore. The agreement is subject to the execution of a split commodity agreement on terms acceptable to the company, expected within the coming weeks.
The Mt Ida iron ore project provides Fe with licenses to explore and mine iron ore in the Yilgram province, 180 km northwest of Kalgoorlie, as well as 9.5 km of strike of the eastern unit of the Mt Ida-Mt Bevan banded iron formation units.
The Mt Ida iron project is in proximity to established infrastructure, including a sealed road, gas pipeline and rail which offers access to operational port facilities at Esperance and Kwinana, with Esperance set to increase capacity from the current 11.5 million mt per year to 32 million mt per year in the near future.
Fe plans to immediately commence initial exploration at Mt Ida iron project with the objective to design a drilling program to commence later in 2011.