Eagle Star Minerals Corp (CVE:EGE) said Tuesday it has inked a deal to acquire the Bomfim agro-mineral project in Brazil, which is located 20 kilometres away from MBAC Fertilizers' (TSE:MBC) Itafos Arraias property.
is located in the southern most part of the Tocantins state, along the
same phosphate mineralized trend in which MbAC holds the Itafos mine.
The region is considered to be the new phosphate belt of Brazil and has seen action with majors such as MBAC, Vale, Votorantim and Bungee.
Star said all exploration permits, for 30,922 hectares across 4 claims,
as well as licenses, are already in place. An aggressive exploration
program has been outlined with the aim to define an NI 43-101 measured
and indicated resource as soon as possible.
Eagle Star said the
project shares "much of the same" technical characteristics and
economics that can be found in the proven geological model of Itafos.
more, early mapping and sampling as part of Eagle Star's due diligence
have shown a "very strong case" for the extension of the Itafos
mineralization to pass directly through the Bomfim claims.
Bomfim also sets nearby the agricultural centres of West Bahia and NE Goias States as well as existing local infrastructure.
Star said it will explore the possibility of moving directly into small
scale production of the high grade crushed phosphorite, as a natural
fertilizer, to assist with the funding of initial operations.
"We believe that with this acquisition we have propelled the company
to the next level in terms of its development," said Eagle Star's newly
appointed COO, Dr. Jose Eloi Guimaraes Campos.
"The resemblance of this property's technical characteristics to that
of MbAC's Itafos is quite remarkable and as such present an attractive
investment opportunity in terms of its risk/reward profile.
any mining company, especially a junior one like ourselves, a proven
geological, exploration and economic model provide a clear competitive
advantage and a great starting point when it comes to developing an
opportunity such as this one."
Under the terms of the deal announced today, the company will form a
partnership with Quantum Mineracao, in which Eagle Star will own a 75
per cent equity interest.
The partnership will own 100 per cent
of Bomfim, with Eagle Star having the right to acquire a full 100 per
cent stake of Bomfim by making staged cash and share payments.
initial cash payment, upon which Eagle Star will earn 75 per cent of
the project, will consist of 50,000 Brazilian Reals to Quantum within 10
business days from TSX Venture Exchange approval.
To gain the
full 100 per cent, Eagle Star must also make two cash payments at the
end of the first and second phases of exploration, respectively, as well
as a cash or share payment once an NI 43-101 proven resource report is
The main mineralization at Bomfim hosts outcropping
phosphorite lenses, from where Eagle Star has sample results of up to
The exploration program at the site is
planned to extend over a 16 month period, with scout drilling of 2,600
metres kicking-off as early as October.
The target areas delineated by the initial scout drilling program
will then be further detailed by regular spaced drilling totaling 27,000
metres at an average depth of 40 metres, the company said, to assist
geological modeling and an NI 43-101 resource calculation.
Eagle Star has been bulking up its position in Brazil ever since
announcing a strategic switch in focus to phosphate exploration in
February. Phosphates are a key ingredient for inorganic fertilizer.
Last week, the company said it increased its land package in the
Canabrava block at its Ruth project in Brazil by 17,509 hectares - 11
claims - in light of its most recent discovery. Earlier this month,
Eagle Star found a mineralized phosphate package of at least 7 metres in
thickness at Canabrava which was still open at depth and contained
grades of up to 12 per cent phosphate.
The Canabrava block at Ruth now covers 40,678 hectares across 23 claims.
The company also said in June that it identified an area within its
Samba project in Brazil that combines high grade phosphate with rare
earth element mineralization. The 109,285-hectare Samba property, which
consists of 60 mineral claims, is located near the cities of Valenca and Sao Jose do Peixe in Brazil, and near Eagle Star's Ruth phosphate project.