Chinese company inks deal for Australian ore

Chinese company inks deal for Australian ore

Chinese resource investment company Sinom recently signed a Memorandum of Understanding with Australia's Aztec Resources Limited in order to obtain a minimum 10.5 million metric tons of ore over a period of 15 years or the lifetime of the Koolan mine, which ever comes sooner. The deal would guarantee Sinom a rate of 700'000 metric tons per annum. On Sinom's end, the company will finance the development and construction of the project, which will be carried out on the Koolan Island Mine in Australia. Sinom, which sells iron ore to major steel mills in China, previously made another agreement to mine iron ore on Mount Gibson. On Aztec Resources Ltd's side, this is the third Memorandum of Agreement signed by the company. Aztec will extract 22.5 million tons of iron ore during the lifetime of the mine, according to these three agreements. Koolan Island Mine is situated in the Buccaneer Archipelago of Yampi Sound, 130km northwest of Derby in Western Australia. BHP Billiton opened the mine in 1965 and operated it until 1993. BHP extracted approximately 68 million metric tons of high-grade hematite ore (67% Fe) from five pits at Koolan between 1965 and 1993. The Koolan ore was recognized in the market as a premium ore with very high iron grades. Commercial details will be provided upon the completion of contract negotiations.