Tata Steel in strategic alliance with Canada's Labrador Mines
Tata Steel has entered into a strategic pact worth Canadian dollar 30 million with Labrador Iron Mines Holdings and the agreement includes transfer of 51 per cent stake in one of the deposits owned by the Canadian entity to it.
"Tata Steel through its subsidiary Tata Steel Minerals Canada Limited (TSMC), entered into a framework arrangement with LIM to establish a strategic relationship ... the two companies have agreed to co-operate with each other in various aspects of their respective iron ore operations in the Labrador Trough," the steel major said in a statement.
The company said as part of alliance LIM shall transfer 51 per cent interest in the Howse deposit, which is estimated to contain 28 million tonnes (MT) ore reserves, to TSMC.
It added that TSMC also has an option to further increase its ownership of Howse deposit to 70 per cent for a consideration of additional Canadian dollar 25 million.
The strategic relationship will include multi-part co-operation agreements in areas of logistics and potential off-take arrangements including development of a rail line that will pass through LIM's rail yard facilities and connect TSMC's processing plant with the main rail line. It also include further exploration of Howse deposit.
"In consideration of all of the above, LIM shall receive up to Canadian dollar 30 million. TSMC will also transfer its Timmins 4 deposit having resource of 1.7 MT to LIM at a consideration of Canadian dollar 3 million recoverable from sales," the statement said.
The Labrador Trough is a 1,100-kilometre long, 160-kilometre wide
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