London, England — MININGREVIEW.COM — 11 December 2008 – Mano River Resources Incorporated – the TSX and AIM-listed exploration and development company focused on iron ore, diamonds and gold in West Africa – has closed the transaction with the Severstal Resources wholly-owned Dutch subsidiary, Lybica Holding B.V. to finance and develop the Putu Range iron ore project in south eastern Liberia which is held under African Iron Ore Group Limited (AIOG).
An announcement here revealed that Severstal had now acquired a 61.5% equity interest in AIOG, while Mano’s holding had been reduced from 80% to 38.5%. In light of Severstal’s majority interest, AIOG would be re-named Severstal Liberia Iron Ore Limited, and Severstal would become the operator on the project. The company had announced on 24 October 2008 the two year extension of Mano’s Putu Range Iron Ore exploration licence, which satisfied all material legal requirements to close the deal with Severstal.
The announcement revealed that Severstal was investing US$30 million (R309 million) – US$15 million (R154.5 million) by way of a new subscription of shares in AIOG and US$15 million (R154.5 million) through a loan facility agreement – to advance Putu through to a definitive feasibility study. AIOG was currently in the final stages of an initial 4 000m drill programme aimed at further delineating the resource at Putu and establishing its quality and quantity. A technical update on the project would be provided in the coming weeks.
Mano CEO Luis da Silva commented: “This is the culmination of many months of work which has taken place with Severstal to progress the Putu iron ore project. We are convinced Severstal brings the complimentary technical expertise and skills to develop an asset of this magnitude. Its input will allow us to accelerate the development of Putu and realise value in the medium term,” he added.