Australian iron ore mining firm, BC Iron will additionally acquire a 5% ownership in Cleveland Mining at A$0.642 per share.

Cleveland Mining had undertaken scoping studies at Brazil’s Ferradura Iron Project for advanced stage iron ore exploration.

Located in the Northern state of Amapá, the project is likely to produce five million tons of iron per year.

BC Iron managing director Mike Young said, "Brazil has a vibrant iron ore industry, including a domestic market, a very skilled and able workforce, and the right geology that’s very favourable for further discoveries."

Young added that with the joint venture, BC Iron would foray into a new market containing prior established key individuals and intellectual property.

Cleveland Mining managing director David Mendelawitz said, "BC Iron has successfully built a 5 million tonnes per annum Joint Venture operation with Fortescue Metals Group in the Pilbara in rapid time."

The Nullagine Iron Ore Project of BC Iron and Fortescue Metals currently generates five million tons annually.