Kilo Goldmines submits bid for Afghan iron ore concession

Africa-focused Kilo Goldmines (CVE:KGL) said Monday it has submitted a bid for the mining rights to the four-concession Hajigak iron ore deposit in Afghanistan.
The company has not been notified yet by the Afghan Ministry of Mines of the outcome of the bidding process. If selected, Kilo would have the exclusive right to negotiate with the ministry for the mining rights to the concession block for which it was selected as a "preferred bidder", before a final award is made.
Kilo was commenting in the wake of press reports that it may have won the iron ore concession in the country.
The Hajigak iron ore deposit is situated in the mountainous Bamyan province, 130 kilometres west of the capital, Kabul. It is one of several iron deposits within this area and is the largest located to date.
Kilo said its bid was prepared by an independent group led by David Buckle, a UK-based corporate financier, who would be responsible for the financing and management of the project.
If awarded, the project would be held in a new entity with Kilo receiving an initial 20 percent interest, subject to dilution, but with no funding obligation.
The independent financing and management structure was presented in the bid documents submitted to the Afghan ministry. The independent group is required to reimburse Kilo for expenses incurred in the bidding process and to indemnify it for any losses sustained.
Kilo said that the bid was initiated earlier in the year and the board determined that it would be in the best interests of the company to continue with the bid given the potential financial benefits and limited downside risk following the agreement of independent group to reimburse the company for expenses and provide it with indemnification.
Shares in Kilo Goldmines were flat at 18.5 cents Monday afternoon.