Australian miner IMX Resources Limited has announced an alteration to a contract previously signed with Chinese steelmaker Jilin Tonghua Iron & Steel Group Co, covering sales to Jilin Tonghua of iron ore from IMX's Cairn Hill project's Phase 1 for the life of the mine.
Under the terms of the alteration, the definition of benchmark pricing has been revised to reflect the current index-based pricing mechanism used for long-term iron ore sales contracts.
Under the original sales contract, which was signed on August 11, 2008 and amended on February 15, 2010, there was provision to move to an alternate pricing mechanism in the event that the traditional annual iron ore benchmark pricing ceased to exist. With the demise of the benchmark system, Termite Resources NL, IMX's 100 percent owned operating subsidiary for Cairn Hill, and Tonghua Mining have agreed to change the pricing mechanism to reflect the current custom and practice for the pricing of iron ore. The new pricing mechanism is index based and adjusted for freight to provide an FOB equivalent price.
The project is expected to export about 1.7 million metric tons of ore a year via Port Adelaide when it is completed. The mine currently has inferred and indicated resources of 11.4 million metric tons, at 49.5 percent iron, 0.4 percent copper and 0.1 percent gold.