Chinese domestic steel producer Rizhao Iron and Steel Co. (Rizhao Steel) has said that it has settled its dispute with Australian miner Mount Gibson Iron Limited regarding iron ore supplies.
At the end of 2008, due to Rizhao Steel's failure to adhere to a long-term iron ore supply agreement amid the global financial crisis, the two sides resorted to the courts for arbitration.
In August 2010, the Western Australian authorities decided that Rizhao Steel should compensate Mount Gibson to the amount of $114. Following the decision, Rizhao Steel filed an appeal.
On October 11, both parties finally reached an agreement on the continuation of iron ore supplies. Accordingly, Mount Gibson states that it has agreed settlement terms on behalf of its two operating subsidiaries with Rizhao Steel in relation to two arbitral awards delivered in Mount Gibson's favor in August 2010. Under the latest agreement, Rizhao Steel will enter into two offtake agreements with Mount Gibson, the first of which is in respect of an agreed quantity of mineralized waste material from Koolan Island, and the second for hematite iron ore from Mount Gibson's Extension Hill project.