Australian iron ore junior IronClad Mining has signed a Memorandum of Understanding with Linzhou Iron and Steel of China for the sale of a minimum of one million tonnes of iron ore a year from its Wilcherry Hill project in South Australia. When converted into sales contracts this will account for at least half of Wilcherry Hill’s iron ore output. The ore will be transported by road and rail from Wilcherry Hill to Port Adelaide for shipment to China.
IronClad Executive Chairman Ian Finch said the MOU was in line with the company's aim of establishing long-term relationships with substantial and stable off-take partners while retaining the ability to sell some of its high quality iron ore into the spot markets.
He added that the MOU would be in force from 15 February 2010 until the signing of the first sales contracts between the parties or 31 December 2010 - whichever comes first.
Lizhou Iron and Steel is the second largest steelmaker in southern China with over 8 million tonnes of steel produced in 2009. The company aims to produce 10 million tonnes in 2010.
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