TORONTO, ONTARIO--(Marketwire - March 20, 2012) - Montero Mining and Exploration Ltd. (TSX VENTURE:MON) ("Montero") has signed a non-binding Memorandum of Understanding ("MoU") with Star Earth Minerals (Pvt) Limited ("Star"), a rare earth chemical company based in Mumbai, India. Star is seeking to secure a consistent supply of Light Rare Earths from Montero's Wigu Hill REE Project in order to supply its customers in the glass, ceramic and catalyst industries.
The main objective of the MoU is to outline the basis of cooperation between Star and Montero with the objective of signing an off-take agreement for Star to purchase mixed rare earth and cerium carbonate from Montero. It also contemplates to share technical information related to rare earth process technology for the development of a rare earth refinery to further beneficiate material from the Wigu Hill Rare Earth Element Project in Tanzania. Through hydro-metallurgical testwork with Mintek, Montero has produced samples of saleable rare earth products (see news release dated 05/03/2012) which were instrumental in concluding discussions with Star.
||Dr. Tony Harwood, President and CEO of Montero commented, "The signing of an MoU off-take agreement between Montero and Star is the first step in de-risking the Wigu Hill Project while securing end user distribution channels ultimately designed to generate REE sales revenue for Montero. Star is a producer of rare earth chemicals to the Asian market with considerable expertise in rare earth refining which also compliments Montero's fast-track to market strategy."
The cooperation between the Parties under this MoU may take the following forms:
- Within three months of signing this MoU, Star and Montero will sign an off-take agreement for between 1,000 to 3,000 tonnes per year of mixed rare earth and cerium subject to agreement on price and product specifications.
- Star and Montero will cooperate to share technical data and technology information developed by Star and Montero for the development of the Refinery Project; and,
- Should Star and Montero confirm their interest in the development of a Refinery Project, they will discuss future funding options.
The MoU remains in effect for twelve months from now and is not intended to create any legally binding rights or obligations. Either Party may terminate this MoU at any time by mutual consent or by submitting a written notification to the other party.
Montero is of the view that the mineralized material at the Wigu Hill Rare Earth Element Project will have sufficient mineralization and grade to support the proposed off-take agreement with Star. The potential quantity and grade is conceptual in nature and the current NI 43-101 resource estimate consists of inferred mineral resources that are considered too speculative geologically to have the economic considerations applied to them that would enable them to be categorized as mineral reserves. Any conclusion that the Wigu Hill Rare Earth Element Project can be placed into production is preliminary in nature and there can be no certainty that it can be placed into production on an economic basis until such time as the resources thereon may be categorized as mineral reserves in accordance with the standards of NI 43-101 and that, furthermore, a production decision is supported by a positive feasibility study prepared in accordance with NI 43-101. Results from the in-fill drilling completed at the Twiga Zone will be used to update the existing NI 43-101 resource estimate, which is expected during Q2 2012.
A high-level scoping study is underway at Wigu Hill which will lead into a Preliminary Economic Assessment which is expected to be completed during Q2 2012.
About Star Earth Minerals (Pvt) Ltd.
Star Earth Minerals (Pvt) Ltd. is a manufacturer of light rare earth compounds for commercial and R&D applications and has an operating plant in Maharashra, India. Star has a team of experienced chemists with a background in manufacturing and processing and has a strong R&D facility which can produce materials as per desired specifications. Star has an extensive customer base in South East Asia and Japan.
About Montero Mining and Exploration
Montero Mining and Exploration Ltd. is a mineral exploration and development company engaged in the identification, acquisition, evaluation and exploration of mineral properties primarily focused on rare earth elements (REE), phosphates and uranium in Tanzania, South Africa and Quebec, Canada respectively. Montero is focused on adding value for all shareholders through the exploration on properties, which have the highest potential for future discoveries or development of existing mineral resources into mineable reserves. We remain engaged in the development of our flagship Wigu Hill Rare Earth Element Project in Tanzania, which is a high-grade Light Rare Earth Element deposit. The Company's current focus is on updating the initial NI 43-101 Mineral Resource Estimate and advancing the hydro-metallurgical testwork with Mintek. Montero's growth strategy is to develop the Wigu Hill Rare Earth Element project and to bring this to account through eventual rare earth production and cash flow, while operating in an environmentally and socially responsible manner. Montero trades on the TSX Venture Exchange under the symbol MON.
With the rising prices of REEs and China's control over export quotas, it is becoming imperative that the rest of the world develops new rare earth resources to meet the increasing demand from "green" technology and high-tech applications.
Dr. Tony Harwood, President and CEO
CAUTIONARY STATEMENT: This News Release includes certain "forward-looking statements". These statements are based on information currently available to the Company and the Company provides no assurance that actual results will meet management's expectations. Forward-looking statements include estimates and statements that describe the Company's future plans, objectives or goals, including words to the effect that the Company or management expects a stated condition or result to occur. Forward-looking statements may be identified by such terms as "believes", "anticipates", "expects", "estimates", "may", "could", "would", "will", or "plan". Since forward-looking statements are based on assumptions and address future events and conditions, by their very nature they involve inherent risks and uncertainties. Actual results relating to, among other things, results of exploration, project development, reclamation and capital costs of the Company's mineral properties, and the Company's financial condition and prospects, could differ materially from those currently anticipated in such statements for many reasons such as: changes in general economic conditions and conditions in the financial markets; changes in demand and prices for minerals; litigation, legislative, environmental and other judicial, regulatory, political and competitive developments; technological and operational difficulties encountered in connection with the activities of the Company; and other matters discussed in this news release. This list is not exhaustive of the factors that may affect any of the Company's forward-looking statements. These and other factors should be considered carefully and readers should not place undue reliance on the Company's forward-looking statements. The Company does not undertake to update any forward-looking statement that may be made from time to time by the Company or on its behalf, except in accordance with applicable securities laws.
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.