China Armco Metals has formed a strategic relationship with Australian iron ore exploration company Apollo Minerals which involves subscription and offtake agreements.
The subscription agreement will see Armco maintain up to a 19.9% interest in Apollo, raising Aus$4.3 million.
These funds will be used to advance the Apollo’s iron ore exploration activities, to carry out processing option studies and to evaluate opportunities to access local infrastructure and other project opportunities.
Apollo has also agreed to sell to Armco not less than 15% of the off-take from its flagship Mount Oscar iron ore project.
Apollo’s chairman Sevag Chalabian says, “The Apollo Board welcomes the substantial investment by Armco and believes that this agreement has created an early strategic alliance for Apollo with potential customers in the rapidly growing Chinese iron ore and steel industries.”
Before entering into the subscription agreement, Armco conducted an extensive due diligence, including a site visit to the Mount Oscar project. As a result Armco believes that Mount Oscar has the potential to become a significant iron ore project.
Mount Oscar project is close to existing infrastructure and large iron ore projects in the Pilbara region of Western Australia and currently has an exploration target of 350 million to 650 million tonnes @ 30-37% iron.
Stage 1 drilling identified significant iron mineralization. Following the recently completed geological structural mapping, which identified promising targets in the Banded Iron Formation horizons in the southern sections of the project area, sampling of these horizons has started and will be undertaken in conjunction with ongoing mineralogical and metallurgical studies.
China Armco Metals is listed on the NYSE Amex. Through its subsidiaries, Armco imports, sells and distributes various metal ore and non-ferrous metals to the metal refinery industry in China. Its products include a range of metal ore, such as iron ore, coal, chrome ore, nickel ore, copper ore, scrap metal, and manganese ore.
apollominerals.com.au

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