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Mt Gibson cancels another contract

6th July 2017

Creamer Media Senior Deputy Editor: Australasia

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PERTH (miningweekly.com) – Iron-ore miner Mount Gibson Iron has cancelled another offtake agreement for its Iron Hill mine, in Western Australia, this time with Sinogiant Steel Holdings Group.

The ASX-listed company said on Thursday that Sinogiant had failed to comply with a fundamental term under the offtake agreement, which was initially signed in November last year. The agreement would have accounted for about one-quarter of the first year’s planned production at the Iron Hill mine.

The scrapping of the Sinogiant deal comes a month after Mount Gibson terminated an offtake agreement with Xinyu Iron and Steel Group, citing failure on the part of the Chinese firm to comply with the terms of the agreement.

That offtake agreement would have seen Hinyu buy about one-quarter of the first year’s available production from the Iron Hill iron deposit, in Western Australia, over a period of 12 months.

Mount Gibson CEO Jim Beyer said on Thursday that the company continued to sell its Iron Hill material into the market, and was expected to place all production from Iron Hill with customers as it became available.

Based on the current development schedule, Mount Gibson expects the project to contribute 400 000 t to 500 000 t of ore to product sales for 2016/17, with total life-of-mine product sales expected to be between 5.5-million and 6-million tonnes through to late 2018, when production will likely be completed.

Edited by Creamer Media Reporter

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