International diversified resources company, Astra Resources, has signed a memorandum of understanding (MOU) for a world scale iron sands development in North East Philippines.
The agreement between Astra and Cagayan River Construction & Development Corporation (CRCDC), owned by businessmen Rocky Young and Valentino Acuzar, intends to establish a joint venture entity to manage and put to use the iron sands deposits in the Cagayan River Delta located in the Cagayan Valley region in the north eastern part of Luzon in the Philippines.
The Joint Venture is subject to final due diligence, including legal, independent geological reports and Astra Resources board approval.
Astra CEO Dr Jaydeep Biswas says third party reports including geological studies from CRCDC show that the area is an established producing region exporting to nearby steel manufacturing markets such as China, Korea and Taiwan.
Legal advice received by CRCDC advises that a Memorandum of Agreement (MOA), signed by CRCDC and the Province of Cagayan, allows immediate dredging of the delta and export of the iron sands.
Extension of this operation outside of the immediate delta into the shallow adjacent areas will require a future Mining License or Mineral Production Sharing Agreement (MPSA), with the legal advice on this opportunity also positive.
The geological studies and extensive sampling further suggest that at dredging depths of 14 metres, well above 9 billion tonnes of iron sands, are available in the delta and adjacent areas with iron contents between 27 and 59% Fe, with an average of 46% Fe, Dr Biswas says.
“The joint venture will start dredging a small part of this area under the MOA and extend when the MPSA is granted.
“The magnetite sands need to be washed and separated and production of 60% plus Fe sands for export is expected to result from 30 to 60% recovery rates of dredged sands depending on the layers to be dredged.”
The joint venture would give Astra a super-majority in terms of profit share interests and is dependent on Astra providing bond finance facilities to finance the development and operation.
Astra Managing Director Silvana De Cianni says the finance requirement to bring the project to fruition is low given its scale.
“The opportunity fits with Astra’s business model which focuses on the steel value chain, low infrastructure and logistics investment, low extraction costs, proximity to markets, licenses to operate being imminent and pathways to revenues being defined,” Ms De Cianni says.
“The operation would be fully mechanised supported by commercial dredging equipment and suction and discharge to barges.
“The external reports also advise that the separation technology is developed, proven and patented in Taiwan.”
“This would be a fast-track entry into mining in the Philippines with future opportunities to develop assets in manganese, gold and copper.”
The Philippines iron sands opportunity provides Astra with a significant potential export business to China, Taiwan and Korea at a time when India’s steel industry is growing exponentially and is providing a greater internal market for Astra’s operations in Orissa, India.
Astra Resources global portfolio includes gold and copper interests in Southeast Asia, coal mines in Africa, iron ore in India, and the production of the high-strength T-Steel technology in Hungary.
CEO Jaydeep Biswas Astra Resources global portfolio includes gold and copper interests in Southeast Asia, coal mines in Africa, iron ore in India, and the production of the high-strength T-Steel technology in Hungary. Jaydeep Biswas.
