PERTH (miningweekly.com) – Iron-ore miner Fortescue Metals has approved the development of the $2.6-billion Iron Bridge magnetite project, in Western Australia.

The ASX-listed miner said on Tuesday that the project is expected to produce 22-million tonnes a year once in full operation, producing a 67% iron content product, suitable for pellet feed or blending with sinter fines.

First ore delivery is expected in the first half of 2022, with the ramp-up to full production taking place over 12 months.

Fortescue told shareholders on Tuesday that five binding offtake agreements accounting for 5.3-million tonnes a year of production, have already been concluded.

“The Iron Bridge project holds Australia’s largest Joint Ore Reserves Committee-compliant magnetite resource supporting a long mine life. The successful delivery of the project by the joint venture (JV) partners is underpinned by Fortescue’s unparalleled track record and capability in safely developing and operating major iron-ore projects in the Pilbara,” said Fortescue CEO Elizabeth Gaines.

“We are confident this project will deliver growth in earnings and cash flow, resulting in enhanced returns to our shareholders and our JV partners through all market cycles.”

Fortescue holds a 69% interest in Iron Bridge with its JV partner Fermosa Steel holding the remaining 31% interest. The JV partners will each be responsible for their equity share of the capital expenditure required for the project, while Fortescue will manage and operate the project with full marketing rights.

The actual product mix will be based on market conditions, allowing Fortescue to deliver greatest value to the project partners, Gaines said.

“The Iron Bridge project will deliver a premium product with iron content of 67%, further enhancing the range of products available to our customers through our flexible, integrated operations and marketing strategy.

“When combined with the Eliwana development, it will increase Fortescue’s average product grade and provide the ability to deliver the majority of our products at greater than 60% iron, consistent with our long-term goal,” she added.

“We are confident in the long-term demand for this premium product, supported by market fundamentals, including global supply conditions, investment in higher efficiency steelmaking capacity, as well as the competitive advantage of proximity of the Pilbara to key markets in China and the region.”