CCI invests in Brazil mine

CCI invests in Brazil mine

March 6, 2007 Filed Under: Iron Ore Mining  

ISHPEMING ”” Cleveland-Cliffs Inc. announced Monday that it has completed a transaction to acquire a 30-percent interest in the Amapa Mine in Brazil.

The mine, which is expected to have about 6.5 million tons of iron ore concentrate, includes a 119-mile railway connecting the mine location to an existing port facility and 71 hectares of real estate on the banks of the Amazon River, which CCI indicated is reserved for a loading terminal.

CCI purchased 100 percent of the shares of Centennial Asset Mining Fund LLC at a cost of $133 million to acquire the 30 percent ownership of the Amapa Project. According to a press release from CCI, the all-cash transaction was financed with cash on hand.

”We are pleased to close this transaction, which marks Cliffs’ initial Latin American endeavor, and look forward to contributing to its long-term success,”Joseph A. Carrabba, CCI president and CEO, stated in the press release.

According to Carrabba, the project will have its own management team, with CCI providing technical and administrative services. Oversight of the project, as well as other potential opportunities in the area, will be coordinated from CCI’s newly opened office in Rio de Janeiro, Brazil, Carrabba said.

It is estimated that $350 million of additional capital will be required for the project to become fully operational, which will include about $250 million of project-level debt financing. According to CCI, the company will be responsible for its 30 percent pro-rata share of equity capital.


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