WorldVest, Inc announced that its wholly owned subsidiary, Chile Inversiones de Minerales has signed an Investment Letter of Intent which outlines the acquisition of 70% of an existing iron sands reserve development project, in Chile's Fourth Region, Coquimbo. Furthermore, as an element of the LOI, the Company will assume control of two new Port Development Concessions allowing for the construction of Cape sized ports adjacent to the La Serena Beach Reserve property.
The property is two kilometers by one half kilometer in dimension. Based on studies completed in 2009 by Chile's leading University, the property is believed to contain two interrelated iron ore deposits; approximately 5,000,000 tonnes of recoverable high grade iron ore located on the beach amongst its Mineral Concessions and an additional estimated 75,000,000 tonnes located on the ocean floor within a pending Marine Concession. With iron ore CIF prices currently exceeding USD 140 per tonne, the current total value of these iron ore deposits is greater than USD 11.2 billion USD, with mining anticipated over the next 15 to 20 years.
Through this transaction, CIM will acquire the mineral exploitation concessions and all rights to the pending Marine Concession. The Mineral Concessions grant CIM the right to begin mining iron ore along the shoreline, pending final environmental approval, while the corresponding Marine Concession will allow CIM access to extensive iron sands deposits on the ocean floor, thereby achieving increased production volumes. Upon completing this transaction, CIM will commence iron ore processing operations on this site with initial scheduled monthly delivery of up to 200,000 metric tons of iron ore against existing Chinese purchase contracts beginning in first quarter 2011.
The ocean currents, which are responsible for transporting the marine floor deposits onto the sandy shoreline, allow CIM to utilize an innovative and proprietary process, Regenerative Trench Mining to extract the minerals located on the ocean floor prior to obtaining a final Marine Concession. The RTM process consists of digging trenches parallel to the ocean during low tide so that, when high tide returns, the trenches will be filled with fresh iron sands carried by the currents and ready for extraction the following day. This RTM process offers a temporary solution for accessing the marine floor iron ore deposits prior to the Company receiving the pending Marine Concession, which will allow for the greatest access to these substantial reserves.
Beyond the rich iron ore deposits on the property, the Company was initially drawn to the La Serena Beach Reserve due to its proximity to the mid-sized publicly-owned Port of Coquimbo, which dramatically enhances its near-term viability. Furthermore, the Company is committed to ongoing infrastructure investment with the goal of developing the acquired Port Development Concessions into ports capable of loading up to 900,000 metric tons monthly.
Mr Garrett K Krause CEO said that "The acquisition of the La Serena Beach Reserve in the Coquimbo Region positions Iron Mining Group to begin 2011 producing iron ore from mines in three different regions of Chile. In this way, we will be able to take advantage of three mid-sized regional ports, thereby maximizing our monthly export capacity and as a result, earnings potential. Further, the opportunity to develop two Port Development Concessions in addition to the extensive iron ore reserves, exponentially increases the projected future ROI of this transaction. Needless to say, we are extremely pleased and anticipate this as the beginning of long and profitable operations in Chile's Coquimbo Region."
