Waratah Gold looks to walk among iron ore giants with deal in the Congo
Waratah Gold (ASX: WGO) will deal itself into the highly prospective African iron ore space with an an agreement to acquire a majority interest in the Youkou Iron Ore Project, in the Republic of Congo.
Youkou is located on the Invindo Massif in the north west of the Republic of Congo. Historic iron ore outcrop workings returned DSO type iron grades of 69% Fe and low levels of phosphorous and silica.
Youkou is host to other large scale iron ore projects including Sundance Resources? (ASX:SDL) Nabeba iron ore deposit; Core Mining?s Avima iron ore project and Equatorial Resources? (ASX:EQX) Badondo Iron Project.
Waratah has agreed to pay US$1.7m and issue 5,500,000 fully paid shares at settlement as well as additional milestone payments via share issues.
In terms of all important infrastructure, Waratah proposes to partner with Solethu Investments as Solethu has played an important role in securing the project for Waratah. Solethu has a Joint Venture with Grindrod Limited in RRL Grindrod developing rail infrastructure on the African Continent.
Limited recent exploration has been undertaken at Youkou however, based on information compiled by the Geological Survey of South Africa. Most projects in West and Central Africa have potential DSO iron ore mineralisation which occurs as a capping derived from supergene enrichment of the underlying upright itabirite protore lithologies. Magnetite rich bands have typical thicknesses of up to 200 metres in the ROC.
To help fund the acquisition, Waratah has an indicative commitment A$1.7 million at $0.15, with the capital raising subject to shareholder approval.
