Cantex announces option agreement with Vale

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[{"type":"text","content":"\n\n\n\nKELOWNA, BC, Nov. 20 /CNW/ - Cantex Mine Development Corp. (CD: TSX\nVenture Exchange) ("Cantex", the "Company") is pleased to announce that Vale\nInternational SA ("Vale"), a wholly-owned subsidiary of Companhia Vale do Rio\nDoce (NYSE: RIO, Vale), has signed a letter agreement for the Company's Suwar,\nWadi Qutabah nickel, copper, cobalt and platinum group element projects in\nYemen.\n\n\nVale's minimum exploration commitment under the agreement is US $2\nmillion to be spent prior to August 31, 2009. Vale has the right to acquire up\nto a 60% interest in the mineral exploration licenses for Suwar and Wadi\nQutabah through a series of progressive expenditure and activity thresholds.\n\n\nVale earns a 40% participating interest in the Suwar upon completing a\nprefeasibility study on or before July 31, 2010, expending US $3 million on\nthe Suwar project and making a US $1 million option payment in favour of\nCantex. An additional 11% is earned by completing a feasibility study and a\nfurther 9% interest is earned by financing mine development and achieving\ncommercial production. If Cantex's share of mine development costs are carried\nthrough to production by Vale, they are recouped by Vale as a development loan\nfrom 80% of Cantex's share of profits.\n\n\nThe agreement also allows Vale to enter into a joint venture with Cantex\non any other nickel, copper or cobalt bearing property, including the\nCompany's Al Masna'a deposit, in Yemen. The obligations are similar for each\nindividual property.\n\n\nThe agreement remains subject to acceptance by the TSX Venture Exchange.\n\n\nThe parties met with the Vice President of Yemen who was most pleased to\ninvite Vale's participation. The Yemen government's stated aim is to promote\nforeign investment in the mining sector to the current level of investment\nthat has been attained by the petroleum sector in that country.\n\n\nCantex is extremely pleased with the agreement as Vale has the technical\nand financial capacity to develop the Suwar and Wadi Qutabah deposits.\n\n\nVale is the world's largest producer of iron ore and iron ore pellets,\nthe world's second-largest producer of nickel and one of the world's largest\nproducers of manganese ore and ferroalloys. Vale also produces bauxite,\nalumina, aluminum, copper, coal, cobalt, precious metals, ...

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