Latin Resources (ASX: LRS) is focused on Peru where the company has several projects.
At Ilo Norte the focus is iron, copper and gold, while at Guadalupito the target is iron and heavy mineral sands - with the company targeting a JORC Resource in 2011.
Latin Resources in transformative acquisition of iron and mineral sands project in Peru
Latin Resources (ASX: LRS) has acquired a highly prospective iron and mineral sands deposit in Peru containing 20 mining concessions totalling 14,068 hectares of world class Iron and Heavy Mineral Sands tenements at Guadalupito in Peru.
Guadalupito is one of Latin Resources' most advanced projects and the company is known to be bullish on the exploration potential and our research indicates it could have an exploration target of up to one billion tonnes of magnetite.
At this level, the deal could be a transformative for Latin Resources potentially transforming the company into a global developer and producer of magnetite and heavy mineral sands.
Due to its proximity to high quality infrastructure, significantly just 10 kilometres from Chimbote, home to a major Port of Chimbote and one of the largest steel smelters in the country, there is understandable excitement about this acquisition.
The acquired 14,068 hectare iron and heavy mineral sand deposit is adjacent to the company's existing Guadalupito project in Peru, increasing the total tenement size by over seven times to 16,268 hectares.
The Iron and mineral sands deposit could potentially contain economically viable amounts of Magnetite – with a low Titania content ~ 4-5%, gold and Andalusite.
Using simple standard treatment processes, it may be possible to produce iron concentrates from Latin’s Guadalupito iron and mineral sands prospect that are arguably higher in Fe grade with possibly a lower TiO2 content.
Helping the company's short and medium cash flow, consideration of US$20.035 million for the acquisition is payable over a period of ten years providing funding flexibility.
Highlighting the prospectivity of the area for gold recovery, historical records show around 500 artisanal workers in the early 1980's working the beach.
Geological mapping already conducted at Guadalupito confirms that at least 6,000 hectares within the company’s concessions, identifying the potential for an economic content of; magnetite (3.5 - 15.1%), andalusite (5.3 – 16.5%), gold (6 - 556 mg/m3), monazite (REE) (trace – 1.7%), zircon (trace – 1.1%) and ilmenite (trace – 2.8%).
Importantly for the future profit potential at the project, capital costs are expected to be low as only very simple beneficiation will be required due to extensive weathering.
Chris Gale, managing director, said “Acquiring tenements of this quality has potential to turn Latin Resources into one of the world’s pre-eminent producers of magnetite and heavy mineral sands.
“We are delighted to announce this company making acquisition and will now focus our efforts on delineating a JORC compliant resource at Guadalupito.”
Latin will now seek shareholder approval for the transaction.
At a valuation of sub $28 million, this acquisition is transformative for Latin Resources because of its potential scale and exploration target and proximity to port and to one of the largest steel smelters in Peru.
