Anglesey Mining buys into Sweden's Grangesberg iron project

29th May 2014 13:39

Anglesey Mining has agreed to acquire a controlling interest in the Grangesberg iron project in Sweden.Prior indications are that Grangesberg, which was closed in 1989, has at least 115m tonnes of iron ore containing around 40% iron, with geological conditions that Anglesey said make the project well suited for cost-effective production.FTSE Fledgling-listed Anglesey has made a series of agreements, including the purchase for $145,000 of a direct 6% interest in Grangesberg Iron AB (GIAB), a private Swedish company that holds a 25-year exploitation permit covering the underground mining operations at Grangesberg.Anglesey has negotiated a 12-month evaluation option for an all-shares acquisition of 51% of the enlarged share capital of GIAB, and has entered into shareholder and cooperation agreements such that during the term of the option Anglesey holds management control and operatorship of GIAB and will appoint three out of five directors to the board of GIAB including the Chairman.The Grangesberg mine site has good infrastructure, lying close to the Swedish national rail system, and still has significant underground and surface infrastructure, including a fully operational railway line from mine to port."It is expected that following the normal environmental permitting processes and engineering design and financing, a conventional underground bulk mining operation followed by processing using standard technology can produce some 2.0-2.5m tonnes per year of saleable iron ore concentrate for the European, Middle East and Asian steel markets," Anglesey said.Shares in the company were up 14.29% to 4p by 13:45 on Thursday.OH