Arrow Minerals Ltd (ASX:AMD) has executed a non-binding term sheet to acquire up to a 60.5% controlling interest in Amalgamated Minerals Pty Ltd, a private Singaporean registered company, which holds a 100% interest in the Simandou North Iron Project in Guinea, West Africa.
The Simandou North Iron Project offers an early-stage opportunity to access the premium iron belt in West Africa at a time when significant infrastructural improvements are underway, including the ongoing construction of shared-purpose rail and port infrastructure.
This project, at the northern end of the Simandou Range, forms an extension of the stratigraphy that hosts one of the largest undeveloped high-grade iron deposits in the world, including Rio Tinto’s Simandou Project, with a total measured, indicated and inferred mineral resource estimate of 2 billion tonnes grading 65.5% iron.
"Extraordinary opportunity"
Historical exploration work through the early to mid-2000s, including airborne magnetic geophysical surveys, geological mapping and completion of four diamond drill holes, confirmed the continuation of the iron-hosting Simandou Group stratigraphy into the Simandou North permit.
The company has a three-month exclusive due diligence period to assess the Simandou North Iron Project.
Managing director Hugh Bresser said: “We are excited to be able to provide shareholders with exposure to this extraordinary opportunity.
"Global demand for high-grade iron ore continues to grow and the Simandou Range hosts the world’s largest undeveloped high-grade iron deposits.
"Simandou North Iron Ore Project allows Arrow to participate in the development of an area where until now mineral wealth has locked up due to infrastructural constraints.
"The emergence of a combined commitment between government and industry opens the way for Arrow to potentially establish itself as a major West African mining company.”
Capital for the move
Arrow has also received commitments from qualified sophisticated and professional investors for a non-brokered, private placement of nearly 60 million shares at 0.6 cents per share to raise A$350,000. The share price represents a 200% premium to market.
Proceeds of the raising will be used on Arrow’s existing projects and to complete the due diligence on the Simandou North Iron Project.
Managing director Hugh Bresser said: “We are pleased to be able to deliver a placement at a significant premium to market.
“This permits the company to execute its corporate growth strategy while minimising dilution to existing Arrow Minerals shareholders.”