Nullagine off-take and funding boost

Exploration & Development

Publishing Date: 11 Nov 2009 5:21pm GMT
Author: Mining Journal

BC Iron Ltd has secured $US50 million in funding and the first off-take deal for its Nullagine iron-ore joint venture in Western Australia.

Nullagine, a 50:50 JV with Fortescue Metals Group Ltd, has been contracted to supply 20Mt of iron ore over 8.5 years to an unnamed Hong Kong-based industrial company. The latter company will also provide funding for Nullagine through a US$50 million loan, which BC has earmarked to continue development of the project. The first US$15 million tranche of the funding will be drawn down in December. At the same time, BC Iron will issue 8 million options to the lender.

Nullagine will be a direct-shipping-ore mine with anticipated production of 1.5Mt/y, eventually ramping up to 5Mt/y.