BC Iron has formally entered into a joint venture with Fortescue Metals Group (FMG) to develop the Nullagine Iron Ore Project, located in the Pilbara region.
According to the company’s managing director Mike Young, the joint venture has been formalised ahead of a planned test pit with the intention of commencing production as soon as possible.
“After discussions with FMG, both parties have agreed that forming the joint venture now is in the best interests of fast-tracking the project to production,” he said.
“The joint venture team has agreed to a minimum threshold for material from the Nullagine test pit that is comparable to the Value-in-Use for Robe River pisolite.
“Based on the results of the feasibility study and our recent marketing trip to China, we expect to well and truly surpass this benchmark.”
Construction is expected to commence later this year, so production can begin in the first half of 2010.
The project will have an initial production rate of 1.5 mtpa, which will be increased to three mtpa and five mtpa as infrastructure is upgraded.
Studies at the 120,000 tonne bulk sample test pit at the Outcamp deposit will begin in mid-September.
The process will confirm the surface miner type and performance, dilution and reconciliation, metallurgy, value-in-use and ore price benchmark determination.
The company has received native title and ministerial approval to remove the excess tonnes and is currently awaiting final approvals from the Department of Mining and Petroleum.
This is expected within the next week, the company said.
A delegation of senior BC Iron personnel visited China in July to hold meetings with four steel mills and two iron ore stockists.
The mills are currently using, or have used, the Yandi Pisolite ores that will be produced at the project and are very interested in entering into long-term sales contracts, the company said.
Source: Mining Australia
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