Canadian mining company FBX forges ahead with plans to produce, supply high-grade bauxite
CANADA-based mining company, First Bauxite Company (FBX), which last year announced the discovery of commercial quantities of high grade bauxite at  Bonasika, on the Demerara river just opposite Timehri, has indicated that it is forging ahead with plans  for becoming a producer and supplier. The Company, last week, disclosed that it had engaged Rothschild Inc. one of the world’s leading investment banking organizations, as its exclusive financial advisor in planning, preparing and subsequently implementing project financing for the Bonasika project.

Since its announcement of the Bonasika discovery last year, the company has been doing ongoing exploration work in locations which they have identified as the Bonasika 1, 2, 5, 6 and 7 deposits.

The Bonasika 6 and 7 deposits have been found to indicate a mineral resource of 10.8 million tonnes of unwashed bauxite while deposits 1, 2 and 5 indicate a mineral resource of 2.6 million tonnes to take the total to 13.4 million tonnes.

In a press release, the Chief Executive Officer (CEO) of FBX, Guyanese Mr. Hilbert N. Shields commented: “With these results, FBX has now confirmed the geological prognosis that the Bonasika deposits host considerable refractory grade bauxite.

“While we are comfortable that there is still more bauxite to be inventoried, our focus now is on optimizing the Bonasika Feasibility Study (done in 2010) to include the Bonasika 6 & 7 resources in the economic assessment of the project,” Shields said.

FBX said the resource estimates were National Instrument (NI) 43-101 compliant, meaning that they had been arrived at in keeping with internationally accepted mineral resource classification schemes for public disclosure of information relating to mineral properties by large- scale mining companies.
NI 43-101 is a codified set of rules and guidelines for reporting and displaying information related to mineral properties owned by, or explored by, companies which report these results on stock exchanges within Canada.
This includes foreign-owned mining entities which trade on stock exchanges overseen by the Canadian Securities Administrators, even if they only trade on Over The Counter (OTC) derivatives or other instrumented securities.
These rules were set up to prevent companies from reporting misleading or exaggerating mineral finds for the purpose of defrauding gullible investors.

Rothschild ranks among the world’s largest privately owned banks.

Rothschild will advise and assist First Bauxite in developing a financing plan for the Bonasika project.

The bank’s initial services will include assisting the company in assessing the potential amount, structure and sources of financing, to be followed by assisting it in securing funding.

Rothschild’s role will also include advising on the development of key contracts and structures to ensure bankability and the appointment of an independent engineering firm as well as assisting the company in the implementation of the debt component of the financing.

In connection with its engagement as the company’s exclusive financial advisor, and subject to the approval of the TSX Venture Exchange, (a stock exchange in Canada) the FBX has granted to Rothschild incentive stock options for the purchase of up to 875,000 common shares of the company, at a price of $1.27 per share, for a period of three years.

The mission of FBX, he said, is to become a near-term, medium-sized producer and supplier of high-quality refractory grade sintered (calcined) bauxite from its  land package in Guyana’s historical coastal bauxite belt.

The FBX holdings include the Bonasika Mining Licence, the Waratilla-Cartwright Prospecting Licence, and the Essequibo PGGS Licence.

Bonasika and WarCart licences cover deposits which host near-surface-high quality refractory grade bauxite.

The company recently completed a Feasibility Study over the Bonasika Project and announced its results on July 29, 2010.

The Feasibility Study defines and confirms the viability of an operation based on sequential mining of the three (3) bauxite deposits located on the Bonasika Mining Licence, the construction of a washing plant facility, of a sintering plant and load out facilities at Sand Hills.

The mine will operate at a production rate of 298,500 metric tonnes of raw, dry bauxite per year or 1,148 tonnes per day, the wash plant will produce 162,232 tonnes of washed bauxite concentrate and the two vertical pressurised shaft kilns will produce 100,000 tonnes per year of sintered bauxite for at least 8 years.

The Bonasika bauxite find announced last year, was a pleasant surprise to many in the mining sector due to its proximity to the coast and the mouth of the Demerara River and so far away from the traditional areas of known high-quality bauxite deposits.

FBX had been prospecting for bauxite in Bonasika for the past six years, an area where some amount of bauxite was discovered over seventy years ago, without the full extent of the deposits being realized.
A leading Official of the Guyana Geology and Mines Commission (GGMC) had commented then that the Bonasika discovery should be an eye opener for the large bauxite companies as well as for local geologists since it demonstrated that areas in Guyana which people had ignored when searching for bauxite are now proving themselves.
The company had, last year, disclosed that it planned to start production in 2012 but had added that such a start would be dependent on the availability of US$120M capital investment and the availability of fiscal incentives.
In the release: President of FBX Yannis Tsitos commented: “First Bauxite is delighted to have Rothschild join our team. Together we are dedicated to seeing the full potential of Bonasika realized in the earliest possible timeframe.”