Western Australian-based mining company Riviera Resources has announced that its potential wholly-owned subsidiary South American Ferro Metals (SAFM) has received the Brazilian State Environmental Committee approval it was awaiting for its Ponte Verde iron ore project in Brazil.
Riviera is set to acquire 100 percent of SAFM, following a shareholder meeting that will be held September 13, 2010. The consideration is to be paid based on three performance milestones.
SAFM owns 100 percent of the mineral rights, management and property at Ponte Verde, located 40 kilometers from the town of Belo Horizonte in Minas Gerais state, Brazil.
The project is close to existing infrastructure and to a number of established mining operations, with an initial exploration target of 140-150 million mt of hematite rich itabirite at a range of 33.3 percent to 41.1 percent Fe, upgradeable to +60 percent Fe.
The proposed transaction with SAFM includes the existing plant which has a current production capacity of 1.8 million mt per annum, and therefore no significant capital expenditure is required to move the project into production. A further drilling program is expected to commence upon settlement of the transaction, in order to define the resource.
The Ponte Verde project will continue to be managed by the existing SAFM management team based in Brazil.