PERTH (miningweekly.com) – ASX-listed Strike Resources has secured port access in the Pilbara that will allow the company to start exporting from its Paulsens East project in July.

Strike has executed a formal combined multi-user access and licence agreement (MUA) with the Pilbara Ports Authority (PPA), securing access to the Utah Point multi-user bulk handling facility at Port Hedland for the export of 200 000 t of iron-ore per financial year, subject to Strike and PPA finalising a logistics plan.

Strike plans to start hauling Paulsens East lump direct shipping ore (DSO) into its allocated stockpile bunker at Utah Point in July 2022. The company is planning to ship up to 55 000 t of ore in July.

Strike told shareholders on Tuesday that the company was in ongoing discussions with its marketing agent and project finance provider in relation to securing a sales contract with a Chinese steel mill customer for its maiden export shipments of Paulsens East lump DSO. The company is also exploring hedging arrangements to lock in a fixed sales price for its first shipments to provide more certainty around cash flows and profits.

Meanwhile, Strike also noted that it had been advised by the Western Australian Department of Water and Environmental Regulation that its environmental approvals for the use of the Port of Ashburton for export up to 1.8-million tonnes of iron-ore a year is well advanced, with the works approval for landside operations expected to be issued shortly.

The works approval application for the offshore marine operations is also progressing well in the normal course.

The Port of Ashburton is proposed as a longer-term export solution for Strike given its far closer proximity to Paulsens East, at some 235 km,  versus Utah Point at some 600 km, leading to significantly lower trucking costs from mine to port.

Strike plans a production schedule of up to two-million tonnes a year of DSO from Paulsens East over a three-and-a-half year life-of-mine, which is underpinned by the probable ore reserve of 6.2-million tonnes.

The company will undertake a two-staged development approach, to ensure capital efficiency, with Stage 1 to be focused on surface detrital and low strip ratio materials of up to 400 000 t to be shipped through Utah Point.

Stage 2 production at an annualised rate of up to two-million tonnes a year is proposed to transition from Utah Point to Port of Ashburton at Onslow, with Stage 2 ramp-up expected to be partially funded by Stage 1 cash flows.