Equatorial has signed a conditional binding term sheet with Companhia Rio de Ferro (CRF), a Singaporean private company that indirectly owns the Nimba Alliance project, located close to Mount Nimba ridge, within the Nzérékoré Region of Guinea

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Equatorial to acquire Nimba Alliance project. (Credit: Bishnu Sarangi from Pixabay)

Equatorial Resources has agreed to acquire Companhia Rio de Ferro (CRF), a Singaporean private company that indirectly owns the Nimba Alliance iron ore project in Guinea.

CRF owns 100% of Gui-Appro, which holds the Nimba West permit covering about 300km2, and 56% of First Metal (FMS), which holds the Nimba North permit spanning about 183km2.

The project was previously owned by a consortium of major mining companies, including BHP Group, and has one of the largest landholdings in Guinea’s prolific Nimba Iron Ore Corridor.

In June 2019, Gui-Appro secured the Nimba West exploration permit, which provides the exclusive right to explore iron ore within the permit area.

In August 2020, FMS was granted Nimba North permit the exclusive right to explore iron ore within the permit area.

Both permits were granted for an initial term of three years, which can be renewed twice for a period of two years, where the permit area may be reduced by half for each renewal.

Last year, Gui-Appro applied for the first renewal of Nimba West.

The acquisition is expected to complete within one month, subject to certain conditions, including completion of due diligence, and obtaining all necessary regulatory, ministerial, or third-party approvals.

Equatorial said that the acquisition is consistent with its strategy to focus on large-scale exploration and development of iron ore assets within clusters of major iron ore projects.

The Nimba Alliance project is located within the Nzérékoré Region of Guinea, immediately north of the Mount Nimba ridge which straddles Guinea, Liberia and Côte D’Ivoire borders.

The Mount Nimba ridge, which extends from within Liberia north-eastward into Guinea, hosts several iron projects operated by large mining companies including HPX and ArcelorMittal.

Both Nimba North and Nimba West permits are located to the northeast of the large mining town of Yekepa in Liberia and southeast of Lola in Guinea and collectively cover 483km2 of area.