Casablanca Mining Limited announced that the following progress milestones of Casablanca Mining's majority owned copper sulfate subsidiary, Sociedad Sulfatos Chile SA. Sulfatos Chile is a copper sulfate production project that owns the Anica Copper Mines. Casablanca Mining through its wholly owned subsidiary Santa Teresa Minerals, SA owns 60% of the equity of Sulfatos Chile.
In February 2011, a mining exploitation concession was granted to Sulfatos Chile and recorded in the mine custody department of Illapel. This concession protects the area being developed by Sulfatos Chile for the raw materials to be processed at the Sulfatos Chile plant. On February 15th 2011 the concession was published in accordance with local mining requirements.
On February 21st 2011, a lease offer with purchase option agreement was formalized between Sulfatos Chile and the property owners of the plant site. The lease with option to purchase has a term of 10 years and includes the water rights of 2 liters per second. The property was selected from a list of five proposed sites suitable for the construction of the Sulfatos Chile copper sulfate production facility.
On February 14th 2011, geologists Igor Urqueta and Maritza Rojas, together with Ricardo Arias, conducted a geological inspection visit of Sulfatos Chile's Anica Copper Mine, pursuant to which they concluded that additional studies should be conducted due to the possibility of greater mineral mining resources to fulfill the project requirements than was previously expected.
Also in February, Sulfatos Chile invited private bids from mining industry-related companies for the purpose of constructing and managing a copper sulfate production facility for Sulfatos Chile. After a technical analysis of each proposal and the corresponding specifications, as well as a review of the bidding companies' commercial and financial backgrounds, Sulfatos Chile determined to accept the bid of Ingefribra RCG for the construction and industrial plant startup procedures.
The scope of the offer to build the copper sulfate production facility includes designing the facility, constructing the plant and equipment necessary to meet Sulfatos Chile's projected production needs, and transporting the necessary components and equipment to the plant site.
The bid also includes services such as installation and operational testing of all equipment, training personnel to operate the plant, and developing operational manuals. The bid price was USD 1,150,000 plus any applicable value added tax and is payable in 6 installments based on certain developmental milestones. The plant is scheduled to be complete and operational by late October 2011. Casablanca Mining estimates that the completed plant in full production including all needed capital equipment, in total will cost approximately USD 6.2 million.
In connection with the bid, Ingefribra RCG and Sulfatos Chile have obtained certain approvals and prepared certain guidelines to promote compliance with Chilean health, safety and environmental standards.
