https://www.miningweekly.com

MinRes to earn into Brockman’s Marillana project

27th July 2018

By: Esmarie Iannucci

Creamer Media Senior Deputy Editor: Australasia

     

Font size: - +

PERTH (miningweekly.com) – ASX-listed Mineral Resources (MinRes) has struck a deal with fellow-listed Brockman Mining, which could see it acquire a 50% share in the Marillana iron-ore project, in the Pilbara.

Under a farm-in agreement, MinRes could earn a 50% interest in the project by spending A$250 000 on exploration and development activities and completing the process design criteria of the processing plants, optimise its mine plan study, and finalise a mine development layout plan.

Once MinRes has earned a 50% interest, the two companies will form a joint venture (JV), with MinRes appointed as the project manager.

The Marillana JV will develop and operate a 20-million-tonne-a-year export operation on the tenements, with the potential to increase production capacity to 30-million tonnes a year.

MinRes said on Friday that the development of the mine site and the installation of key non-process infrastructure and utility assets would cost an estimated A$300-million, which would be split by the JV partners.

During the farm-in phase, the companies will determine whether to subcontract or self-perform the drill and blast, and mining services necessary to deliver run-of-mine ore to the processing plants. MinRes, however, will enter into a life-of-mine mining services agreement with the JV to build, own and operate the crushing and beneficiation plants and product stockyards, as well as the train load-out facility.

MinRes will also process the ore on behalf of the JV and load it onto its own rail system for transport to port.

The Marillana ore will be transported on MinRes’ 320 km Pilbara light-rail system, from the mine site to Port Hedland, and once there, the product will be unloaded and stockpiled at the company’s fully automated train receival and port stockyard.

From there the iron-ore products will be loaded onto carriers for export.

“The boards and management of MinRes and Brockman have a shared vision for the future of the Marillana project,” said MinRes MD Chris Ellison on Friday.

“Both companies recognize that MinRes is firmly on track to commence construction of its Pilbara infrastructure project by the middle of 2019, such that the timing was right to formalise an arrangement that will see us work together to bring the project into operation.

“MinRes has the demonstrated ability to develop world-class mining projects on time and on budget, as well as the proven capability of producing iron-ore at the mine gate for a cost that is comparable with the lowest-cost producers in Australia,” Ellison said.

Brockman chairperson Kwai Sze Hoi said the JV was a logical and welcome outcome for both Brockman and the Marillana project in several dimensions.

“Our respective projects will use the same rail and port infrastructure and we will share equally ownership of the Marillana iron-ore resource. Access to infrastructure and economic alignment with an infrastructure owner are the keys to development in the Pilbara.”

The transaction was subject to a number of conditions, including Brockman obtaining the necessary regulatory approvals in Australia and Hong Kong, and from its shareholders; and the parties executing a process and loading agreement, the mine ship logistics agreement, as well as a loan agreement for a A$10-million loan that MinRes will make to Brockman that will be repayable from proceeds received from the sale of Marillana ore.

Edited by Mariaan Webb
Creamer Media Senior Deputy Editor Online

Comments

The content you are trying to access is only available to subscribers.

If you are already a subscriber, you can Login Here.

If you are not a subscriber, you can subscribe now, by selecting one of the below options.

For more information or assistance, please contact us at subscriptions@creamermedia.co.za.

Option 1 (equivalent of R125 a month):

Receive a weekly copy of Creamer Media's Engineering News & Mining Weekly magazine
(print copy for those in South Africa and e-magazine for those outside of South Africa)
Receive daily email newsletters
Access to full search results
Access archive of magazine back copies
Access to Projects in Progress
Access to ONE Research Report of your choice in PDF format

Option 2 (equivalent of R375 a month):

All benefits from Option 1
PLUS
Access to Creamer Media's Research Channel Africa for ALL Research Reports, in PDF format, on various industrial and mining sectors including Electricity; Water; Energy Transition; Hydrogen; Roads, Rail and Ports; Coal; Gold; Platinum; Battery Metals; etc.

Already a subscriber?

Forgotten your password?

MAGAZINE & ONLINE

SUBSCRIBE

RESEARCH CHANNEL AFRICA

SUBSCRIBE

CORPORATE PACKAGES

CLICK FOR A QUOTATION