PERTH (miningweekly.com) – ASX-listed iron-ore explorer Brockman Resources has signed a memorandum of understanding (MoU) with China’s largest iron-ore importer, Sinosteel, under which that company would purchase up to 50% of future production from the Marillana project, in Western Australia.

The agreement covers a maximum of ten-million tons a year, over an initial five-year takeoff period.

Sinosteel would also look at “wider strategic investment options” in the Marillana project, Brockman MD Wayne Richards said on Wednesday.

The signing of the MoU provided Brockman with a strong foundation to complete the definitive feasibility study (DFS) and the project development, it said.

The DFS is currently more than 60% completed and was scheduled for completion during the third quarter of this year.

“The MoU, while assisting Brockman greatly with the completion of our impending DFS and providing a framework for the finalisation of a takeoff agreement for a significant proportion of the Marillana project’s planned production, also allows for wider strategic investment discussions between the two groups, without limiting the possibility of other corporate or joint-venture scenarios,” said Richards.

Recent metallurgical test work results have confirmed that the Marillana detrital ore could be upgraded to a final product grade of between 60,5% and 61,5% iron. The final product specification was comparable with direct shipping haematite ore being mined from other significant Pilbara iron-ore projects.

The Marillana project contains a mineral resource of 1,53-billion tons.

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