PERTH (miningweekly.com) – ASX-listed Mineral Commodities (MRC) on Monday unveiled a $10-million funding and offtake agreement with Garnet International Resources, a member of the GMA Group.
MRC and its empowerment partner Blue Bantry Investments 255 has inked formal agreements with Garnet under which Mineral Sands Resources, which owns the Tormin mineral sands operation in South Africa, will supply 80 000 t/y of finished garnet product in 2024/25.
A further 105 000 t/y of finished garnet product would be supplied in 2026 to 2028, and 125 000 t/y of finished garnet product would be supplied between 2029 and 2033, subject to a renewal of the offtake agreement at Garnet’s election.
In return, Garnet would provide Mineral Sands Resources with $10-million in loan funding, repayable over five years starting in January 2024, to fund the design and construction of a mineral separation plant (MSP) in South Africa.
The size and scope of the MSP will be at Mineral Sands’ discretion, with a minimum concentrate feed of 200 000 t/y the only specified requirement.
“We are very pleased to finalise the GMA agreements, crystallising our long-term partnership with GMA Group and Tormin’s transition from concentrate to higher margin finished product sales,” said MRC CEO Adam Bick.
“This offtake agreement forms the foundation of expanding our revenue base, profitability and cash flows at Tormin. To provide context, the Tormin operation produced 179 000 t of garnet concentrate in 2022, highlighting that this minimum offtake agreement will cover a significant portion of the available finished garnet produced from current operations.
“The GMA funding agreement also allows construction of an ilmenite MSP, with ilmenite finished product to be sold into the lucrative, well-established finished ilmenite market. We welcome the opportunity to renew and formally extend our long-standing relationship with GMA and explore new opportunities to expand our mutually beneficial commercial interests."