Fenix and Atlas reach sales agreement
PERTH (miningweekly.com) – ASX-listed Fenix Resources has struck an agreement with Atlas Iron under which Atlas would market 50% of the proposed iron-ore produced at the Iron Ridge project, in Western Australia.
Fenix in 2016 acquired the Iron Ridge project from a wholly owned subsidiary of Atlas Iron, with the transaction providing Atlas a first right of refusal to act as the exclusive marketing agent for up to 50% of the iron-ore to be mined and sold from the project, subject to it meeting commercial terms.
Atlas Iron has now elected to act as marketing agent for this production, with Fenix telling shareholders on Monday that a long-form agreement is currently being drafted. Subject to the marketing election, Atlas Iron would waive its right to the A$1/t royalty on the iron.
A 2019 feasibility study estimated that the project would produce some 1.25-million tons a year over a six-and-a-half-year mine life, and would require a capital investment of A$11.9-million.
Fenix is hoping to start development activities at the mine later this year, with a view to first shipments in early 2021.
The company is working on finalising product offtake arrangements for the remaining 50% of production, and on executing port access and port lease agreements.
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