Kaolin Mining Rights in Rio Capim/PA

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The Rio Capim Caulim Project is located in the municipalities of Ipixuna do Pará and São Domingos do Capim, in the northeast of the state of Pará, and corresponds to mining processes 812.869/1971 to 812.878/1971, totaling 10,000 hectares divided into two blocks, South and North. There is basic infrastructure available on site and the deposit is close to another kaolin project. Research activities were developed in the 1970s, when research wells were drilled and drilling holes were carried out by CPRM; for the reassessment work on the deposit, carried out in 2018, 93 observation points were considered, covering research wells, trenches and auger and rotary borings, totaling 1,817.05 m. Whiteness index and yield values were estimated for two types of ore: soft kaolin (low sand content) and sandy kaolin. In the North Block, 574 million tons were estimated, with a waste: ore ratio of 1:1. In the South Block, the total estimated resources were 218 million tons and a waste: ore ratio of 0.9. The sum of resources reached 792 million tons, with an average brightness index of 80%. Considering recovery of 65%, total resources are equivalent to 520 million tons. The investment estimate (CAPEX) for the project is 2 billion reais with the implementation of the entire structure for mining, processing and transporting ore from the plant to the port through a mining pipeline, according to the economic evaluation report prepared by a contracted consultancy. by CPRM. PPI Council Resolution No. 72, published on August 21, 2019, recommended the qualification of the Caulim do Rio Capim project in the Investment Partnership Program, and Decree 10,116/2019, published on November 19, 2019, qualified the project at PPI. The valuation studies were completed and the statement was filed with the Federal Audit Court on February 23, 2021. CPRM carried out the public consultation on the project notice from April 12th to May 14th, 2021, and the Public Hearing on May 28th, 2021. On September 21, 2022, CPRM published the notice of the event in the Official Gazette of the Union. The notice, its annexes and more information are available on the CPRM website The winning company must carry out a minimum mineral exploration program budgeted at R$1 million to confirm the economic viability of the project. This program must be executed within six months after signing the assignment promise contract. The auction, to be held on a date to be defined by CPRM, should result in the following fundraising amounts: minimum signature bonus of R$500,000 (five hundred thousand reais) as a precondition for signing the Mining Rights Assignment Promise Agreement ; opportunity premium 1, in the amount of R$2.5 million, to be paid as a prior condition for the execution of the private instrument for the assignment of mining rights; opportunity award 2, in the amount of R$7 million, to be paid within ten working days from the publication of the first mining concession in the Official Gazette of the Union; and a royalty of 1% on gross revenue in the operation and production phase, which is the criterion for judging the auction. The CPRM Presidency published Auction Notice No. 005/2023 on September 18, 2023. According to the Postponement Notice published in Section 3 of the Official Federal Gazette of 10/16/2023, the bidding was postponed. The new date for holding the public auction session (10/23/2023, at 10 am) was announced in the Bidding Notice published in Section 3 of the DOU of 10/18/2023. The auction documents are available at the following link: https://www.cprm.gov.br/publique/-7142.html On November 21, 2023, CPRM published the Auction Suspension Notice No. 5/2023 in Section 3 of the DOU.