The two companies first entered into a strategic alliance in August 2012 with the stated aim being to acquire such projects in Brazil.
Under the first stage of the MoUs, the alliance will spend some $4 million on exploration, with BC Iron noting that the expenditure for each following stage would be dependent on the success of the preceding work to delineate economic mineralisation.
“The Cleveland alliance and these MoUs are a natural part of BC’s three-priority business development strategy,” said Managing Director, Mike Young. “The deal structure is consistent with our approach to potential growth opportunities in Brazil; that is, the upfront expenditure is relatively small but increases with success and de-risking, and we maintain a tight, commercial relationship with the vendors, who have the in-country knowledge to assist with approvals and community liaison.”
Young added that the alliance believed the projects represented the best grass-roots projects identified and were worthy of meaningful follow-up work. “The main game for BC is, as always, maintaining its focus and operational efforts on the Nullagine joint venture and considering growth potential in the Pilbara to maintain positive shareholder return and a strong balance sheet.”