Sichuan-based Tai Fung Group, a private Chinese enterprise, has signed a binding framework investment agreement to acquire a 19.9 percent stake in Australian mining company Ferrowest Limited, which is developing the Yalgoo Iron Project in Western Australia.
Upon the approval of the agreement by the relevant regulatory authorities, Tai Fung will become the largest shareholder of Ferrowest and will receive 50 percent of supplies from Ferrowest's Yalgoo Iron Project and Western Hematite Project.
Ferrowest is currently carrying out development work on the Yalgoo Iron Project, a project aimed at producing seaborne-traded merchant pig iron from the Yogi iron ore deposit, 14 km east of Yalgoo in the mid-west region of Western Australia. Subject to the successful completion of feasibility studies, production is scheduled to start in early 2014.
Initial production output is expected to be one million mt per annum of high quality (96 percent Fe) merchant pig iron in the physical form of iron nuggets.