Magnum to Issue 190 Million Shares for Brazilian REE Projects, Eyes Saudi Iron Deal
Magnum Mining and Exploration Limited moves forward with acquiring two promising rare earth element projects in Brazil while progressing negotiations on a green pig iron venture in Saudi Arabia.
- Agreement to acquire Palmares and Azimuth REE projects in Brazil
- Technical due diligence completed on Palmares tenement with promising assay results
- Conditional acquisition requires shareholder and regulatory approvals
- Ongoing investor negotiations for Green Pig Iron Project in Saudi Arabia
- Exploration expenditure modest at A$53,240 during the quarter
Strategic Expansion into Brazilian Rare Earths
Magnum Mining and Exploration Limited (ASX: MGU) has announced a significant step in its growth strategy with an agreement to acquire the Palmares and Azimuth Rare Earth Element (REE) Projects in Brazil. These projects are located across the Minas Gerais, Goiais, and Bahia states, regions increasingly recognized for their REE potential. The acquisition is subject to due diligence, regulatory, and shareholder approvals, with a deadline set for 31 January 2025.
The deal involves a US$100,000 cash payment and the issuance of 190 million shares to the vendor, Beko, pending shareholder approval. Additional shares will be issued to StarGroup and Interminico Services Limited as part of the acquisition facilitation, alongside a cash reimbursement to StarGroup for incurred costs.
Technical Due Diligence Highlights Potential
Magnum has completed technical due diligence on one of the eighteen Palmares tenements, the Feirinha Prospect. Geological mapping revealed extensive pegmatite dyke swarms, with surface rock sampling returning up to 1.31% Total Rare Earth Oxides (TREO). Trenching results showed assays as high as 1.69% TREO, with notable concentrations of critical heavy rare earths terbium and dysprosium, essential for advanced technologies.
The Azimuth Project, covering over 1,200 square kilometers along the AZ125° Lineament, remains a greenfield exploration target with no prior exploration activities conducted by Magnum. The region's geological setting, featuring granitic and alkaline intrusives, is highly prospective for REE mineralisation, attracting interest from major players including Fortescue Metals Group.
Parallel Progress on Saudi Green Pig Iron Project
Alongside its Brazilian ambitions, Magnum is advancing negotiations with investors for its Green Pig Iron Project in Saudi Arabia. The project envisions constructing a HIsmelt plant utilizing steel mill waste and magnetite from Magnum’s proposed Buena Vista mine. Discussions with a Saudi steelmaking company are reportedly progressing well, signaling potential for a strategic foothold in sustainable iron production.
Financial and Operational Outlook
During the December 2024 quarter, Magnum’s exploration expenditure was modest at A$53,240, reflecting early-stage activities. No mining development or production occurred in this period. The company plans to convene a shareholder meeting to approve the share issuances related to the acquisition and is reviewing funding options to support upcoming work programs.
Magnum’s dual focus on rare earths and green iron projects positions it at the intersection of critical minerals and sustainable industrial metals, sectors poised for growth amid global supply chain realignments and decarbonization efforts.
Bottom Line?
Magnum’s next moves on shareholder approvals and funding will be pivotal in unlocking value from its Brazilian REE assets and Saudi iron ambitions.
Questions in the middle?
- Will Magnum secure shareholder approval for the substantial share issuance tied to the acquisition?
- What funding arrangements will Magnum finalize to support exploration and development activities?
- How will the company balance advancing its Brazilian REE projects with progressing the Saudi Green Pig Iron negotiations?
