RESA Group Limited (ASX: RE1) has entered into a binding agreement with the shareholders of Tombador Iron Singapore Pte Ltd (TIS) to acquire 100% of its issued capital.
TIS owns 100% of Tombador Iron Mineração Ltda (TIM), which is the titleholder of Brazilian National Mining Agency (ANM) exploration tenement number 872.431/2003 containing the high grade Tombador hematite iron ore deposit (Fe 67%) located in Bahia, Brazil.
The project has a total combined JORC Mineral Resource of 10.1Mtwhich includes a high-grade Hematite Mineral Resource of 8.0Mt at 67.3% Feof DSO hematite.
The Project offers RESA, which is to be renamed Tombador Iron Limited, a potential near term low capex development opportunity which aims to satisfy the burgeoning demand for high grade, low impurity lump ore.
Exploration tenement ANM 872.431/2003 is located in the Municipality of Sento Sé, in the state of Bahia, Brazil ~700km by road from the state capital of Salvador.
RESA said negotiations with the landholder with respect to surface rights (land access) are well advanced.
A Final Exploration Report (FER) was approved and published in the Brazilian Federal Gazette in mid-February 2020. Following the approval of the FER, TIM is required to present the Project PAE Feasibility Study (PAE) to the National Mining Agency (ANM) before February 16, 2021 as a condition to obtaining the Mining Licence for the Tenement.
- 100% share-based consideration of 1.1b fully paid ordinary shares issued to the TIS Shareholders; and
- RESA to undertake a re-compliance capital raising of up to $15m at $0.025 per Share.
Following completion of the Acquisition, RESA intends to apply funds raised under the Capital Raising to complete:
- Infill drilling and detailed mine planning;
- Mobilisation of mining contractors to site;
- Site facilities construction (roads, buildings, crushing plant);
- Final permitting for operating and mining licence; and
- Commence production.