Ferrum Americas Mining Inc.
TSX VENTURE : FEM

Ferrum Americas Mining Inc.

May 24, 2012 14:26 ET

Ferrum Americas Mining Receives Environmental Permits for Cerro Rojo Iron Ore Project in Bolivia

4,000 m Drill Program Scheduled to Begin in June

TORONTO, ONTARIO--(Marketwire - May 24, 2012) - Ferrum Americas Mining Inc., (TSX VENTURE:FEM) ("Ferrum" or the "Company") is pleased to announce the receipt of environmental permits for its Cerro Rojo iron ore project located in eastern Bolivia, approximately 55 kilometres west of Puerto Suarez and the Hidrovia River system near Corumba, Brazil. The Corumba iron ore district hosts a number of world class iron ore deposits including Vale's Corumba mine and the large El Mutun deposit in Bolivia.

2012 Program Objectives

The permit allows Ferrum to start its field programs at Cerro Rojo which will include a 4,000 m diamond drill program which the Company anticipates will begin by late June. The permit allows for a full spectrum of exploration activities including bulk sampling.

Additional program objectives for the balance of this year include:

  • Complete sufficient drilling in 2012 leading to a NI 43-101 compliant resource estimate by the first quarter of 2013.
  • Complete additional metallurgical test work.
  • Complete preliminary logistics analysis of the rail and river barge potential for low cost shipping of ore iron ore products to market.
  • Initiate baseline environmental studies in preparation for an Environmental Impact Assessment and future feasibility analysis.

Community Relations

Considerable support was received from the communities near Cerro Rojo, in particular Yacuses, which took a proactive approach in supporting Ferrum's permit applications. This included letters of support and requests to meet with government officials to support our project.

"Unlike many jurisdictions around the world, the Community of Yacuses and its leaders have shown a remarkable level of support for our company and our project. This pro-mining and pro-economic development attitude demonstrated by the local communities near Puerto Suarez is something we respect and fully intend to support so that all stakeholders in Cerro Rojo, including our local communities, are rewarded," Nick Tintor President and CEO of Ferrum said.

Cerro Rojo Project

Cerro Rojo is a large Neoproterozoic banded iron formation which is part of the regional iron ore trend extending into Bolivia from the world class Corumba-Urucum iron ore fields located 75 kilometres to the east in Brazil. Cerro Rojo strikes for more than 4 km and has been mapped for more than 1,000 m along its dip slope. Surface sampling grades average in excess of 50% Fe according to reports prepared by Rio Tinto in 1999 and verified by Ferrum.

Preliminary metallurgical test work completed by Ferrum generated excellent results suggesting iron ore from Cerro Rojo will liberate well and can be upgraded to produce a product of attractive iron grade. The test work shows that an excellent quality iron concentrate can be produced at a relatively course grind size and with a high mass yield. (See Press Release dated January 19, 2012 for complete details of the metallurgical test work)

Logistics

An internal logistics analysis is in progress which is determining costs and options for transporting an iron ore product from Cerro Rojo to Atlantic shipping. Cerro Rojo is located approximately 55 km from Puerto Suarez which is located on the Hidrovia river system, the Mississippi of Latin America according to The World Bank (1). Large barge convoys are already used to transport iron ore down river to off load sites in Argentina.

Vale and MMX, both operating in the Corumba-Urucum iron ore fields in Brazil across from Puerto Suarez, are currently shipping more than 8 million tonnes of iron ore annually utilizing barge tug convoys on the Hidrovia.

Other Business

The Company has granted stock options to acquire an aggregate of 550,000 common shares to directors, employees and consultants of the Company under Ferrum Americas stock option plan. Each option granted to the directors, employees and consultants is exercisable for a five year period to acquire one common share at a price of $0.27 per share and vest on an annual schedule.

(1) "Strengthening Bolivia's Competitiveness-Export Diversification and Inclusive Growth" A World Bank Country Study, 2009, The World Bank

About Ferrum Americas Mining

Ferrum Americas has rights to acquire a 98% interest in the Cerro Rojo iron ore project in Bolivia. Located 600 km east of Santa Cruz and approximately 55 km from Puerto Suarez and the Hidrovia river system near Corumba, Brazil, Cerro Rojo is a large banded iron formation striking for more than 4 km and sample grading in excess of 50% Fe, according to reports prepared by Rio Tinto in 1999 and verified by Ferrum.

Ferrum Americas is planning an aggressive exploration and development program for 2012 designed to advance Cerro Rojo and surrounding iron ore projects towards feasibility and production.

Laurence Curtis, PhD, P.Geo., is a Qualified Person as defined by National Instrument 43-101 and has read and approved the technical content of this press release.

Forward Looking Statements

This news release may contain forward-looking statements that are based on Ferrum Americas Mining Inc.'s expectations, estimates and projections regarding its business and the economic environment in which it operates. These statements are not guarantees of future performance and involve risks and uncertainties that are difficult to control or predict. Therefore, actual outcomes and results may differ materially from those expressed in these forward-looking statements and readers should not place undue reliance on such statements. Statements speak only as of the date on which they are made, and the Company undertakes no obligation to update them publicly to reflect new information or the occurrence of future events or circumstances, unless otherwise required to do so by law.

Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.

Contact Information

  • Ferrum Americas Mining Inc.
    Laurence Curtis
    Chairman
    1 289 242 7422
    lwcurtis@cogeco.ca

    Ferrum Americas Mining Inc.
    Nick Tintor
    President and CEO
    1 416 987 0855
    ntintor@rgmi.ca

    Ferrum Americas Mining Inc.
    Leslie Haddow
    Corporate Secretary
    1 416-637-3523
    lhaddow@rgmi.ca