PERTH (miningweekly.com) – Mineral sands miner Sheffield Resources has signed a seven-year offtake agreement for 650 000 t/y of primary ilmenite from its Thunderbird mineral sands project, in Western Australia.
The ASX-listed company on Monday said the agreement with China’s Bengbu Zhongheng New Materials encompassed all of the primary ilmenite to be produced during the Stage 1 operations at Thunderbird.
“This is the first of several exciting outcomes emerging from the updated bankable feasibility study (BFS), which is running in parallel with the strategic partner process,” said Sheffield MD Bruce McFadzean.
The agreement enhanced the economics of the Thunderbird project by generating additional revenue from primary ilmenite sales, and complemented the strategy identified in the BFS, McFadzean said.
The BFS update strategy targeted a material reduction in project capital by deferring the low-temperature roast ilmenite circuit, while maintaining overall revenue by replacing this ilmenite revenue with increased zircon production.
“We are pleased with the progress of our marketing activities as we work to complete offtake agreements for the additional zircon product estimated to be produced from the updated BFS. Consensus supports the view that the zircon sector will remain in structural supply deficit for many years to come,” said McFadzean.
Under the agreement with Bengbu, the two companies have also formed a long-term strategic alliance that included the sharing of ilmenite processing technology, samples and data that would be mutually beneficial to the future production of chloride grade slag.