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Xstrata enters Congo iron ore project

By BFN News | 10:01 AM | Tuesday 08 February, 2011

Mining group Xstrata plc is to exercise its call option over Jumelles, a subsidiary of Zanaga Iron Ore Company Limited, which owns the Zanaga iron ore project in the Republic of Congo. Xstrata will acquire a 50% plus one share interest in Jumelles in return for a commitment to fund a feasibility study to a minimum of $100m. The group said its decision underscored a long-stated strategy to enter the iron ore market. It has assembled an iron-ore team which is currently managed through Xstrata Coal. Xstrata Coal chief executive Peter Freyberg said, 'Our decision to exercise our option to acquire management control of the Zanaga Project enables Xstrata to evaluate in greater depth the potential of the project, as part of our strategy to build a meaningful iron-ore business over the medium term.' Under the agreement with Jumelles, Xstrata could elect to acquire 100% of the project following completion of the feasibility study. An indicated and inferred JORC resource of about 3.3bn tonnes, with an average grade of 32.8% iron, has previously been reported by ZIOC. Story provided by

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