PERTH (miningweekly.com) – Junior AVZ Minerals has signed a binding three-year offtake agreement for 6 000 t/y of tin concentrate from its Manono lithium and tin project, in the Democratic Republic of Congo.
The agreement was struck with Kalon Resources, a wholly-owned subsidiary of Noble Group Holdings, which specializes in commodity trading and supply chain management.
The offtake accounted for some 43% of the expected tin concentrate production from Manono.
“After an unexpected delay in finalising this contract, we are very pleased to have finally signed with Kalon, our first tin offtake agreement, just weeks after having signed our second lithium offtake agreement that cumulatively provides binding commitments for more than 50% of our saleable lithium product,” said AVZ MD Nigel Ferguson.
“Given the rising London metal exchange cash price of tin metal, up some 30% year to date, this offtake agreement is significant for the Manono project and also significant given that Kalon is a considerable participant in the tin industry.
“While this agreement represents a relatively small, but growing, portion of revenue for the Manono project, it does confirm another large international business is willing to secure future supply from the project.”
Ferguson said that similar to the recent lithium offtake agreements, the tin offtake agreement would assist AVZ in meeting certain conditions precedent required from prospective financiers for the Manono project.
A definitive feasibility study into Manono has estimated that it would produce around 700 000 t/y high grade lithium and 45 475 t/y of primary lithium sulphate over a 20-year mine life.
The project is expected to require a capital investment of some $545.5-million, which will include transport upgrades and the rehabilitation of the Mpiana Mwanga hydroelectric power plant, which would account for $41.85-million and $46.54-million worth of investment, respectively.