On January 5, Australian iron ore producer BC Iron Ltd announced that it will defend any action taken by Tennant Metals regarding BC Iron's termination of an iron ore sales agreement between the two sides.
The parties entered into an off-take agreement in February 2009, by which Tennant Metals would act as the principal agent in the sale of 25 percent of production from BC Iron's Nullagine project in Western Australia, a 50:50 joint venture with Fortescue Metals Group Ltd. The five-year agreement had to be effective by the start of production in 2010.
However, BC Iron terminated the agreement a few months ago, resulting in Tennant Metals' referral of the matter for arbitration.
"BC Iron is surprised at the referral by Tennant Metals given the express termination provisions within the agreement ... BC Iron will strongly defend any action Tennant Metals may take ... Notwithstanding this dispute, BC Iron wishes to make it clear it appreciates the advice and assistance that Tennant Metals provided to it in the past," BC Iron's statement reads.