Midas Resources (ASX: MDS) has dealt itself into the potentially high margin iron ore business.
Midas will acquire Mulga Minerals Pty Ltd a special purpose company that holds iron ore tenements in the Pilbara District. Mulga holds drill targets with potential for BID and CID iron ore deposits exist on the tenements. The tenements are close to existing or proposed third party infrastructure.
Mulga Minerals also holds two tenement applications with mineral sands potential adjacent to Image Resources Bidaminna Heavy Minerals project in the north Perth basin.
Consideration for the purchase is 6 million Midas fully paid shares and $75,000 in cash, subject to Due Diligence which will be carried out within three months.
Major activity for Midas Resources as an exploration and development company based in Perth, Western Australia is its 100% interest in the advanced Fortitude gold project at Lake Carey. Midas and AngloGold Ashanti have agreed to undertake a pit optimisation and a mining study in the first half of 2009 based on treatment of ore at Sunrise Dam.
Midas recognises that the Pilbara Iron Ore tenements provides Midas with a range of iron ore targets in an area well serviced with infrastructure but with significant challenges in getting access to that infrastructure. Hence, the company will cooperate with other companies for the joint development of infrastructure.
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