Source : THE AGE NEWS
By Craig Nolan
Macarthur Minerals has received a further $250,000 payment from the recent sale for the rights to mine and develop its Lake Giles Ularring iron ore project in WA’s Yilgarn region to Gold Valley Yilgarn.
The deal includes a royalty for every tonne of ore extracted that could potentially generate $89 million for the company which can be directed towards its flagship Moonshine magnetite project.
Macarthur Minerals is aiming to develop its Moonshine magnetite iron ore project in the Yilgarn region of Western Australia.
The royalty deal will net Macarthur $10 million dollars for the first 2 million tonnes of ore Gold Valley ships to the Esperance port from the 80.5 million-tonne project and a $1 royalty for all subsequent tonnes mined for the life of the mine.
‘Receiving this third payment from Gold Valley highlights the strength of our partnership’
Macarthur Minerals chairman Cameron McCall
As part of the life-of-mine agreement, Gold Valley will be required to maintain the tenements in good standing, pay all State Government royalties and secure all necessary approvals required before it begins mining.
While Macarthur will retain ownership of the Ularring project tenements, selling the mining rights will give the company’s finances a major boost and enable Macarthur to focus on developing its 1.3 billion-tonne Lake Giles Moonshine magnetite project that sits next door.
Macarthur Minerals chairman Cameron McCall said: “Receiving this third payment from Gold Valley highlights the strength of our partnership and underscores our shared commitment to advancing Macarthur’s high-value iron ore assets in Western Australia. This milestone marks another significant step on our journey towards production and further strengthens our financial position as we continue advancing our much larger, 1.3 billion tonne Moonshine Magnetite Iron Project.”
McCall also said Gold Valley is now onsite and working diligently with the view to bring the hematite project online later this year, allowing the partnership to gain momentum.
Gold Valley intends to develop the Ularring project to blend product with the crushed ore from its high-grade, 130 million-tonne Wiluna West mine it bought from GWR Group last year. It plans to ship up to 3 million tonnes of iron ore a year.
Gold Valley is a West Perth-based miner privately-owned by Chinese-born businessman Yuzheng Xie and has been making itself known in the WA iron ore sector recently, locking in two iron ore projects in the past year.
Macarthur’s management says it is considering the prospect of bringing in a partner to help develop its massive 100 per cent-owned magnetite deposit.
The company believes its Moonshine project compares favourably with several other magnetite projects around the world. It cites comparisons with Champion Iron’s magnetite project in Canada, based on a completed feasibility study on Moonshine from 2022 relative to Champion’s 2024 pre-feasibility.
Management says Moonshine has slightly higher in-situ grades of 28.2 – 30.7 per cent iron to Champion’s 28.6 per cent and processed concentrate grades achieving 66.1 per cent compared to 65.2 per cent for Champion’s material.
Capital expenditure of US$569 million (A$917 million) would be required to develop the operation, with an expected mine life of 25 years.
Whilst considerably cheaper than Champion Iron’s estimate of US$2.062 billion (A$3.323 billion) needed to fully develop its Kami project in Newfoundland and Labrador near Quebec’s eastern border, Moonshine would be targeting annual production of 3 million tonnes compared to Champion’s larger nine million tonne per annum operation.
Macarthur plans to continue to focus on its large magnetite project to produce the type of green ore that will be required in the coming decades to reduce emissions from highly polluting smelters.
With money in the bag, a cashed-up partner to take it forward and a clear pathway to port, Macarthur would seem to have its ducks well and truly lined up.
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