PERTH (miningweekly.com) – Iron-ore miner Atlas Iron has moved to affect its diversification strategy, finalising a manganese export agreement that will see the company export first product through the Utah Point within the next month.

Some 100 000 t of manganese will be mined and crushed on a campaign basis by privately-owned Horseshoe Manganese, and will then be loaded onto road trains for transport from the Murchison site.

Atlas will purchase the manganese over a four-month period, subject to finalising port approvals and offtake arrangements.

The manganese will be exported as part of split shipments from Atlas’ Utah Point facilities, and the company will load the manganese into dedicated holds of vessels chartered for its iron-ore products.

Atlas MD Cliff Lawrenson told shareholders on Monday that although the initial manganese volumes were modest, the arrangement highlighted the company’s ability to work cooperatively with other mining companies to leverage its existing infrastructure.

“This manganese opportunity complements the strong additional cash flow we will soon be generating from our new lithium operations, again without material capital investment thanks to our existing logistical infrastructure.

“As part of our product diversification strategy, we will continue to look for opportunities which allow us to use our existing skills base and infrastructure,” Lawrenson said.

The company is focusing on a diversification strategy to mitigate its exposure to lower grade iron-ore, which is trading at a steep discount to the high-grade ore that majors, such as Rio Tinto and Vale, are producing.

Besides manganese, Atlas is also adding lithium exports to its shipping mix. In December, the company inked a mine gate sales agreement with fellow-listed Pilbara Minerals for the supply of direct shipping ore (DSO) from the Pilgangoora lithium/tantalum project, in Western Australia, whereby the Pilbara Minerals will deliver a minimum of one-million tonnes of unprocessed run-of-mine, based on a delivery schedule which is designed to allow Atlas to ship 100 000 t/m of DSO to offtake customers, starting in the June 2018 quarter.