Afferro Mining Inc. approves sale of 38.5% stake in Putu Iron Ore Project in Liberia to Severstal
OAO Severstal (“Severstal” or the “Company”), one of the
world’s leading vertically integrated steel and steel related mining companies,
announces that the shareholders of Afferro Mining Inc. have today approved the
sale of its 38.5% interest in the Putu iron ore project in Liberia to Lybica
Holding B.V., the Company’s indirect subsidiary.
The transaction has been formally approved by the TSX
Venture Exchange (TSX-V), where Afferro Mining Inc. is listed. As per the
definitive sale and purchase agreement dated 23 December 2011, the
transaction will be completed by no later than 28 February 2012.
The Putu iron ore project is a 13km long iron rich
ridge, located only 130km inland from the deepwater shoreline of eastern
Liberia. In February 2011 an independent mineral resource report estimated 2.4
billion tonnes of iron ore at 34% total Fe for the project, in June 2011 the
resource estimate was increased to 3.2 billion tonnes of iron ore. A Mineral
Development Agreement detailing the fiscal and legal terms for the development
and mining of the Putu iron ore deposit was granted and ratified by the
Government of Liberia on 9th September 2010. The Agreement term is for a period
of 25 years and this can be extended further in line with the life of mine.
Severstal has held a 61.5% interest in the project since 2008.
ОАО Severstal is one of the world’s leading vertically
integrated steel and steel related mining companies, with assets in Russia, the
USA, the Ukraine, Latvia, Poland, Italy, Liberia and Brazil. Severstal is
listed on MICEX-RTS and the company’s GDRs are traded on the
LSE. Severstal reported revenue of $13,573 million and EBITDA of $3,263
million in 2010. Severstal’s crude steel production in 2010 was 14.7 million
Afferro Mining Inc. is an established exploration and development
company listed on the TSX-V (AFF) and AIM (AFF). Afferro’s portfolio includes
the 100% owned Nkout iron ore project and surrounding iron ore targets in
Cameroon. On 23 December 2011, Afferro has entered into a sale and purchase
agreement with Lybica Holdings B.V., Severstal’s indirect subsidiary, to sell
its 38.5% interest in Putu.