Ferrum Crescent confident in South African project

Ferrum Crescent remained confident in its major South African project on Friday, despite revealing a setback in the timeline for its development in its quarterly update.

The AIM-quoted company said that, during the three months to 31 December 2015, it entered into a legally-binding farm-in and joint venture agreement with Business Venture Investments (BVI) to complete the bankable feasibility study for the Moonlight Iron Project in Limpopo Province, South Africa.

Under the terms of the agreement, in return for fully funding and completing the study across two phases, BVI would earn up to a 43% equity interest in Ferrum Iron Ore, the subsidiary of Ferrum Crescent that holds the project.

Work on the study was expected to commence in the current quarter.

During the period, the company also appointed Justin Tooth as non-executive chairman following the resignation of Ed Nealon, who stepped down from the board to "pursue his other business interests".

Post period end, Ferrum Crescent had agreed with BVI to extend the timetable for the completion of the first phase of the study at Moonlight by three months, to 12 January 2017.

"This extension, in order to finalise the appointment of an internationally reputable engineering firm to manage the study, was granted further to a request from BVI", the company's board said in a statement.

"BVI remains committed and responsible for fully funding and completing the requisite study workstreams", it added.

Ferrum Crescent also said it had recently met with the mayor and councillors of the Municipality of Lephalale, and with leaders of the Ga-Saleke community with regard to the Moonlight project and the company's commitments.

The board said it intended to make commitments around small community infrastructure projects, education assistance and employment provisions.

"We continue to align the project with the infrastructure plans of the South African and Limpopo governments, and seek to address the aspirations and interests of such authorities and those of the local communities and municipalities", said Ferrum Crescent managing director Tom Revy.

"Our aim continues to be the maximisation of the value of Moonlight for the benefit of all stakeholders", he concluded.

At 1015 GMT, shares in Ferrum Crescent were trading at 0.17p.