It is reported that Montezuma Mining has sold the iron ore rights at Mt Padbury to Sinosteel Midwest, a subsidiary of Sinosteel Corporation.

As part of the agreement, Montezuma is entitled to a one off payout of AUD 4 million in cash if Sinosteel Midwest defines a resource of at least 10 million tonnes with an average grade in excess of 50%.

Montezuma Mining confirmed that Sinosteel Midwest had commences a 6000 meter reverse circulation drilling program at Mt Padbury, targeting part of the known 20 kilometers of Banded Iron Formation that outcrops at the project.

Montezuma said that "This milestone is another important step in providing the company with working capital to fund ongoing acquisition and exploration strategies at the Peak Hill Gold Project."

Montezuma's Peak Hill Gold Project is the company’s key area of attention. It is planning to commence drilling this summer, and use the additional data, combined with historical results, to calculate an updated JORC compliant resource. Peak Hill was previously operated by Rio Tinto, who shut the mine down in 1997.

(Sourced from www.proactiveinvestors.com.au)