The contract, which is the first of several contracts with high-profile mining industry companies, supports the New Mexico mining operation plan announced by the Company several months ago and represents another tactical initiative to support the sale of the El Capitan property.
Under the terms of the Master Service Agreement, Logistica US Terminals, a Texas-based Limited Liability Company and member of LIT Group network, will finance and operate the mining of iron ore at the El Capitan mine and provide ECPN with a turnkey solution that also includes shipment of the iron ore to ports where buyers will take delivery.
"This new contract with Logistica is a significant and pivotal milestone in the 30-year history of the El Capitan property," said John F. Stapleton, Chairman of the ECPN Board of Directors, in a statement released to shareholders today. "In capturing the attention — and contract commitment — of a powerhouse in the mining industry we have taken a huge step forward in delivering on our strategic plan for the sale of the property," he added. Logistica has strategic alliances with U.S. and foreign companies to develop turnkey logistical solutions for international transportation and supply chain management.
ECPN President and CEO Chuck Mottley stressed the fact that, for many years, the "Company’s forward motion has been complicated by the presence of iron in the El Capitan ore." He continued: "In turning that challenge into an opportunity we have delivered a contract with a world-class mining and logistics company and have identified buyers for our high-quality iron ore."
Mottley confirmed that the Company will use its minimal impact mining permit. The permit that the Company holds can, within limits, be modified as the iron ore mining plan dictates and reclamation work justifies.
Stapleton reported that the Company’s investment banker has been kept abreast of this major development and that the pending sale of iron ore from the El Capitan site will provide revenue that will both fund operations and generate positive cash flow. The Company plans to retain the tailings for future disposition.
In restating the Company’s primary objective — the sale of the El Capitan property — Stapleton summarized that today’s announcement represents a major turning point for ECPN and "validates the compelling and profitable value proposition the Company’s investment banker will take to the marketplace."
