Maxtech Ventures Inc., ("Maxtech" or the "Company") has signed a Letter of Intent ("LOI") to form a joint venture to develop the Buriturama Mine in the State of Bahia, Brazil with Plantiminas Empreendimentos Rurais Ltda.
The Buriturama Mine is located in the northern portion of the State of Bahia, 862 km from Porto de Aratu with access to railroad, port facilities and infrastructure. The intent of the joint venture is to put the asset into commercial production up to 10,000 tonnes per month with focus on the export market.
The project has significant historical mining records as well as a current Gia (trial mining license) which authorizes mining and processing of up to 6,000 metric tonnes of manganese mineralization. Small scale mining has been undertaken on the project and there are manganese outcrops located throughout the project area as well as mining pits. An application has been submitted to Departmento Nacional de Proucao Mineral ("DNPM") for a Lavra licence which provides for unlimited mining. The company will do both technical and legal due diligence on the asset prior to signing a definitive agreement.
Approximately 100km's north of the Buriturama Mine in Bahia is Vale's Mina do Azul Mine, which is responsible for 80% of Vale's manganese output. Vale SA is the largest manganese producer in Brazil, accounting for roughly 70% of the country's market. Mina do Azul is recognized internationally for the excellent quality of its ore, which contains high concentrations of manganese and a high manganese-iron ratio. Its ore is at least 40% pure manganese which is similar in grade to the Buriturama Mines historical records which are not National Instrument 43-101 compliant but which the company believes to be reliable.
The markets for manganese ore and ferroalloys are highly competitive. High-grade manganese ore competes on a global seaborne basis while low-grade ore competes on a regional basis. The ferroalloy market is characterized by a large number of participants who compete primarily on the basis of price. The competitive factors affecting this market are the costs of manganese ore, electricity, logistics, and reductants.
Peter Wilson, Maxtech CEO, said, "We will begin the due diligence process immediately. The Plantiminas Empreendimentos Rurais Ltda. strategic partnership in the Buriturama Mine will enable Maxtech to build vertical manganese operation in Brazil."
The Company also announces that pursuant to its stock option plan it will issue 1,000,000 options to certain officers, directors and consultants at a price of $0.57 cents per share. The options granted are exercisable up to five years from the issue date.