Core Mining a private company incorporated in the Isle of Man focused on the exploration, development and operation of iron ore projects in Central and Western Africa announced the completion of a major transaction with OAO Severstal.

Core, which owns exploration licenses for the Avima iron ore deposit in the Republic of Congo and the Kango iron ore deposit in the Republic of Gabon, has completed the sale of 16.5% of the Company’s issued share capital to Severstal, Under the terms of the agreement Severstal can invest up to USD 55 million into Core Mining through to the end of 2012.

Core Mining is focused on fast tracking development of the world class Avima and Kango iron ore projects. The funds raised will be used to advance the Company’s exploration programs and establish a JORC compliant resource for both projects in 2010.

The Avima Project is located in the north west of the Republic of Congo and the Company is targeting a multibillion tonne resource. Drilling to date has indicated high grade mineralization of up to 69.75% Fe to a depth of up to 180m. Additionally, initial drill work has indicated significant DSO potential.

The Kango Project is conveniently located near the coast in Gabon and proximal to infrastructure which is able to support development work. The Company is also targeting a multibillion tonne resource. The Kango project provides an opportunity to fast track development through to production targeting an initial annual production of 1Mtpa within 18 months with scope to expand production capacity to 5Mtpa. The project is located 20Km from the Trans-Gabon railway, which has a capacity of 10 million tonne per annum enabling it to support Core Mining’s Kango project.

Mr Socrates Vasiliades CEO of Core Mining, said that “We are pleased that Severstal has made the investment into Core Mining. Severstal’s support underscores the high quality of our assets and as we look to advance our projects we will continue to assess strategic opportunities to finance them through to production. Core has a world class project pipeline and we look forward to progressing exploration work on both licenses in due course.”

Mr Boris Granovsky head of strategy and business development of Severstal Resources OAO Severstal’s mining division said that “The acquisition of a stake in Core Mining is part of our strategy to take part in a portfolio of world class exploration assets in steel-making materials that will be beneficial for target markets in Europe, North America and Asia.”