Below are some highlights from the AVB historical ASX releases in relation to TN.
They are a good background on the tenement and posted solely to give that background.
The Company is very pleased to advise that its subsidiary AVB
Mineracao Ltda has entered into a binding agreement with Brazilian
major Vale S.A. (Vale), to provide them an option to acquire the
Trindade North Property.
Trindade North is believed to be highly prospective for iron ore and is
situated proximal to Vale’s giant N4-N5 iron ore mine in the Carajas,
Brazil. The final agreement has been signed and will be executed as a
partnership with Vale being granted exclusive exploration rights for
up to 3 years. On satisfying conditions precedent, Vale will have earned
the right to exercise an option to acquire sole ownership of the property.
KEY PROVISIONS OF THE AGREEMENT
1. For a two year option term, Vale will pay Avanco a nonrefundable
fee of US$350,000 on signing and receipt of
regulatory permissions to drill.
2. Vale should drill at least 2,500m at Trindade North within the
first year.
3. After one year Vale must pay Avanco US$600,000 for the
second year. To retain and extend the option for a third year,
Vale must make a further payment of US$1,000,000 to
Avanco.
4. Based on drilling results Vale will pay Avanco a royalty for
any in-situ JORC compliant iron ore resources in the
measured and indicated categories.
5. On Avanco receiving funds from Vale inclusive of 1, 3 and 4
(above) estimated at US$10,000,000 or more, Vale will have
satisfied conditions precedent and will have earned the right
to complete the acquisition for sole ownership of Trindade
North. The total sum of all qualifying payments to Avanco is
capped at a maximum value of US$40,000,000.
6. In the event economic mineralisation other than iron ore is
discovered, both parties will renegotiate terms with Vale
retaining preferential rights to first refusal.
7. Avanco can elect a representative to participate in the
exploration programme.
The Company is very pleased to advise that it has obtained the required
permissions for drilling at the Trindade North Iron Ore Project in the
Carajas. The drill programme will be undertaken by Brazilian major Vale
SA (Vale) and rig mobilisation is expected over the coming weeks.
Exploration of Trindade North has been ceded to Vale through the
previously reported option agreement1
. On satisfactory completion of
drilling, resource determinations and payment of US$10m to $40m, Vale
will have satisfied conditions precedent and will have earned the right to
100% ownership of Trindade North.
IRON ORE HIGHLIGHTS
Trindade North is situated proximal to Vale’s giant N4-N5 iron
ore mine in the Carajas, Brazil. The area is very prospective for
new iron ore discoveries.
Vale has been granted exclusive exploration rights and can earn
the right to exercise an option to acquire sole ownership of the
property.
Vale will advance Avanco US$250,000 for facilitating drilling
permissions.
The Vale transaction has the potential to deliver significant cash
flow to Avanco of US$10m to US$40m
Vale is expected to start drilling soon and regular news is
anticipated over the coming months.
The Company is very pleased to announce that Vale SA (Vale) has
commenced drilling at the Trindade North Iron Ore Project (Figure 1).
Four rigs are currently operational and early exploration appears very
encouraging with significant widths of Banded Iron Formation (BIF)
recorded in drill core.
HIGHLIGHTS
Vale has commenced drilling Avanco iron ore in the Carajas
region of Brazil.
Four rigs now drilling and another mobilising.
Significant widths of BIF have already been intersected,
suggesting early exploration success (Fe results TBA1
).
Vale’s giant N4–N5 mine is located close to Trindade North.
The Vale-Avanco agreement has potential to generate payments
of between $10m and $40m to the Company.
Transaction with Vale clearly demonstrates that Avanco is well
established in the region.
The Company is pleased to advise that Vale S.A. (“Vale”) has secured
the “rights” to Avanco’s iron ore project for a further twelve months.
Compliant with the Iron Ore Agreement1
, Vale has secured
their rights into the second year of the Option by having
advanced Avanco US$600,0002
.
Having already completed the maiden drill programme the
current extension facilitates Vale’s further exploration which
includes detailed field recognisance.
Vale has prepared a maiden resource. The Company has
acknowledged that the outcome exceeds the minimum required
for Vale to exercise their right to acquire the project.
AVB Price at posting:
6.2¢ Sentiment: Buy Disclosure: Held
