Anglo-Australian mining giant Rio Tinto has announced that it has reached an agreement with Western Australian Iron Ore Holdings (IOH) enabling ore from IOH's Phil's Creek deposit to be sold to Rio Tinto under an innovative mine-gate sale process.
Under the agreement, the commercial terms for which have been agreed, 1.5 million mt of iron ore will be delivered annually to Rio Tinto, which will then transport the material to the coast for shipment as part of Rio Tinto's product suite.
Commenting on the agreement, Rio Tinto Iron Ore chief executive Sam Walsh stated, "This is a significant development for Rio Tinto, IOH and the Pilbara generally. It is a prime example of how a major established producer and a small progressive junior can work together to achieve an excellent outcome for all stakeholders."
Mr. Walsh added, "Without this deal, the benefits flowing from the development of the isolated Phil's Creek deposit would be denied to the respective shareholders and to the community of Western Australia.''
As per the Rio Tinto statement, the company has also entered an exclusive agreement with IOH to examine its Iron Valley deposit, situated approximately 10 km northeast from Rio Tinto's Yandicoogina operation, which may lead to the purchase of part or all of the lease covering the deposit.