The Western Cluster tender includes a group of three mines, with reserves of over 1.1 billion tons of iron ore. In two of the mines, major companies have mined in the past.
The tender process started one year ago, and was recently completed after due diligence tests, and the Ministerial Committee determined that Elenilto is the winner of the tender.
The finalists also included two other groups: Sociedade de Fomento, Industrial Private Limited from India, and Capital Steel Global Company from China (a part of the Shougang Corporation), which was represented in Liberia by Neil Bush, former US President George Bush's brother.
In return for the license, Elenilto shall pay Liberia an advance payment of $25 million, annual payments, as a social donation, of $3 million a year upon commencement of production, as well as 21% of profits in the project, after return of investment, with a 22.5% yield for Elenilto.
The project's economical value is estimated in billions of dollars.
As part of the development of the mining sites, Elenilto will build a railroad track, will improve the port and invest in other infrastructure. The mining sites are relatively close to the port, at a range of between 65 and 150km, and this is a significant advantage in regard to the transport cost, which is a critical component in the commerce of this merchandise, in comparison with similar mines in the West Africa region.
'One of most attractive mining sites in Africa'
The company is in preliminary contacts for the creation of a consortium of several international financial bodies which expressed a great deal of interest in funding and investing in the project.
Amir Nagammy, CEO of Elenilto's activities in Liberia, who led the tender process, said: "This site, which we selected after meticulous testing, is one of the most attractive mining sites in Africa, both in terms of quality and access.
"It should be stated, that in other similar mines in Liberia which have been geologically researched, it was discovered that the actual reserves are several times greater than the initial estimated quantity, as the China Union Company announced two weeks ago, in regard to a reserve scope three times greater than the planned quantity.
" If, and as we expect, these mines will also be similar in this sense, then Elenilto is expected to hold even greater reserves of between 3 and 4 billion tons, approximately, under the license."