Apurimac Ferrum Resumes $2.3 Billion Peruvian Apurimac Iron Ore Project

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Researched by Industrial Info Resources (Sugar Land, Texas)--After a period of legal disputes between joint-venture partners and uncertainties in the market conditions, Apurimac Ferrum S.A. (Lima, Peru), formed by the Australian Strike Resources Limited (ASX:SRK) (Perth), D&C Group (Lima, Peru) and Minera los Andes y El Pacifico S.A. (Lima, Peru), is resuming activities on the development of the $2.3 billion Apurimac iron ore mine project in Peru. The project is 16 kilometers from the city of Andahuaylas, in the Apurimac province of southern Peru.

A pre-feasibility study shows Apurimac as a 20 million-ton-per-year iron mining operation, with the construction of a 363-kilometer slurry pipeline that will be used to transport the ore concentrate from the mine to the port to be built in Tres Hermanas, near San Juan city. The company expects to select an engineer for a feasibility study to be conducted through 2010. Project completion is planned by mid-2013.

In Peru, Apurimac Ferrum also owns the medium- to long-term Cuzco iron ore mine project, which entails a second 20 million-ton-per-year mining operation with the construction of another slurry pipeline to be connected to the Apurimac slurry pipeline corridor. The project is about 130 kilometers from Apurimac project and 80 kilometers south of the town of Cuzco.

Strike Resources holds 44% interest in Apurimac Ferrum and has an option to acquire another 19% by paying $21.1 million, or to move to 100% ownership through a "shootout offer" mechanism. Strike's principal objective is the development of Apurimac iron ore project. The company owns projects in Indonesia and Australia.

Once operational, Apurimac will be the second iron mine in operation in Peru, along with Marcona mine, owned by Shougang Hierro S.A.A. (Lima, Peru), a subsidiary company of the Chinese Shougang Corporation (Beijing).

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