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Century Iron receives TSX approval to buy properties from Altius Minerals

Century Iron Mines (TSE:FER) announced late Thursday it received approval from the Toronto Stock Exchange in regards to its acquisition of four iron ore properties in Newfoundland from Altius Minerals (TSE:ALS).

Under the terms of the agreement, which was announced in September 2011, Century will earn the right, title, and full interest in the Astray, Grenville, Menihek, and Schefferville properties, located in the Labrador Trough region of western Labrador.

In consideration, Century will issue 40 million shares of its common stock, including 2.0 million shares upon the closing of the transaction, and 3.0 million shares on or before the second anniversary of the closing date.

It will issue the remaining shares in conjunction with the achievement of certain milestones: Century will issue between 1.0 million and 3.0 million shares of its stock for each one billion tonnes of taconite it mines, between 1.0 million and 5.0 million shares for each 33 million tonnes of direct shipping ore it mines, and, for the Grenville property alone, Century will issue between 1.0 million and 3.0 million shares for each 500 million tonnes of meta-taconite that it mines.

Altius will retain a gross sales royalty payment between one percent and four percent, dependent upon the iron ore produced from the properties. Century will also incur at least $28 million in exploration expenditures within five years of the closing date.

Since 2003, Altius has been prospecting for iron ore in western Labrador and is the largest exploration license holder in the province of Newfoundland and Labrador.

Collectively, these projects cover 1,647 kilometres and a major portion of the indicated iron formation inside the Newfoundland and Labrador portion of the Labrador Trough. 

Meanwhile, Century Iron holds a full interest in the Sunny Lake project in Quebec, and a 51 percent interest in the Duncan Lake joint venture project, also in Quebec, with Augyva Mining Resources (CVE:AUV).

Century is also part of an option agreement with Champion Minerals (TSE:CHM) where it may earn up a 60 percent interest in the Attikamagen project, which is also in Quebec.

In Toronto, Century shares traded flat at $2.20. The company's stock has shed 12 percent in the year-to-date.