Gleneagle Gold shares surge on Mauritania iron ore acquisition plan

Gleneagle Gold (ASX: GLN) has signed a letter of intent to conditionally acquire up to a 75% interest in two iron ore exploration projects, via a proposed acquisition and farm in joint venture agreement with Sonko Lowenthal Mauritanie sarl (Sonko), a company incorporated in Mauritania.

The Projects are located in the Inchiri district of western Mauritania, Western  Africa. Exploration licences for iron ore Cetal (791B1) and Kaoua El Khadhra (792B1) will be granted immediately upon payment of final government fees and performance bonds.

Both projects are considered prospective for magnetite-quartzite deposits within banded iron formations (BIF).

Cetal, the northern project of some 498sq km, is located less than 70km south of heavy gauge rail and road infrastructure and a further 180km east, by rail, of the port of Nouâdhibou.

It lies immediately north and along strike of the eastern most of the two exploration licences of the Lebtheinia iron ore project owned by Sphere Minerals (ASX: SPH).

Sphere has reported a combined JORC mineral resource of 2.74Bt (2.18Bt indicated and .56Bt inferred) (ASX: 22 Oct 2009) from its central deposit located 30km west of the company’s northern project.

Kaoua El Khadhra, the southern project of some 960sq km, is 250km northeast of the capital, Nouakchott, by paved road. It is located a short distance from the copper-gold mining operations at Guelb Moghrein and the district capital of Akjoujt.

The project areas have been subject to previous reconnaissance exploration through geological surveys conducted by the British Geological Survey and the French agency, BRGM.

The rail and port infrastructure supports iron ore exports from a number of mines owned
and operated by Societe Nationale Industrielle et Miniere (SNIM).

SNIM, 78% owned by the Mauritanian government, is the world’s 7th largest exporter of iron ore with production expected to double following an expansion of its rail capacity and the construction of a second dedicated port berth facility.

The Mauritanian government fully supports the development of the country’s iron ore assets. A decision by Gleneagle to proceed is conditional on, amongst other things, the completion of due diligence and the obtaining of all necessary shareholder and regulatory approvals.

Gleneagle Gold shares rose 15% to 2.2 cents in trading today.

http://www.proactiveinvestors.com.au/companies/news/6335/gleneagle-gold-shares-surge-on-mauritania-iron-ore-acquisition-plan-6335.html