Marifil acquires Argentine limestone assets

Spokane-Marifil Mines Ltd. reports that it has acquired a 100 percent interest in the Punta Colorado limestone deposit located on the Atlantic coast, near Sierra Grande, Rio Negro Province Argentina. The 545 hectare Punta Colorado property, comprised of two blocks, is dissected by a narrow access corridor occupied by a good road, a 132-kilovolt power line, and a natural gas line with a capacity of 5 kg/cm². Marifil originally acquired the property as part of the land package owned by Marifil S.A. Hierro Patagonico Rionegro S.A. (HIPARSA), which granted a contract to Marifil to develop the limestone but retained a 20 percent interest. This same contract, however, granted Marifil a 20 percent interest in any minerals, other than iron, in the Sierra Grande iron deposit. In 2006, HIPARSA sold the Sierra Grande iron mine; this sale precipitated HIPARSA’s request to Marifil to either move forward or relinquish the property. Marifil, the Province of Rio Negro, and HIPARSA signed a new, superseding contract on Aug. 1, 2008. In the new contract Marifil owns a 100 percent interest in the limestone deposit, subject only to a 32 hectare parcel that the Province wishes to use for a duty-free industrial area. The Province of Rio Negro has one year to develop a duty-free area on the 32 hectare parcel, or it reverts to Marifil under the terms of the present agreement. Marifil is granted a six-year term to carry out exploration, followed by a 30-year term for exploitation. The project is subject to a 5 percent royalty on the mine mouth value of the limestone, payable to the Province annually. The nearby Sierra Grande project is a large, inactive underground iron mine developed by HIPARSA. The mine infrastructure includes an iron pelletizing plant and a kilometer-long, 1,800 mt-per-hour capacity automated deep-water loading dock capable of handling bulk cargo ships. Built around 1980 at a cost of over $35 million, the loading dock is Argentina’s only bulk loading facility. The company plans to carry out market studies and economic analyses to determine whether the resource could support a “cement clinker” plant or direct shipping limestone for smelter flux, as well as options for agricultural, chemical, and other industrial usages.