Fenix Resources has signed a contract worth $360 million for the road transport component of its Iron Ridge iron ore project in Western Australia.
The contract has been executed with Fenix Newhaul – a 50-50 joint venture between Fenix and trucking and logistics company Newhaul.
Fenix stated that the contract, which will commence in December 2020 for the estimated six-year mine life, was in line with its current project development timeline. Iron Ridge is expected to deliver first iron ore sales in early 2021.
In 2019, Fenix formed a strategic alliance with Newhaul (formerly Minehaul), and Craig Mitchell, the founder and former owner of Mitchell Corp, was elected as chairman and chief executive of the newly formed joint venture, Fenix Newhaul.
Fenix managing director Rob Brierley described the joint venture as an “innovative” approach to optimise the transportation costs for the project.
“Road transport was quickly identified as the largest cost component of Iron Ridge. We took an innovative approach to optimise this aspect and we strongly believe that the joint venture concept of Craig Mitchell has been the right way to go.
“Fenix Newhaul plan to commence operations with a mix of sub-contracts and owned fleet and they are actively recruiting for personnel, with most of their employees to be Geraldton-based.”
Fenix Newhaul has already ordered prime movers and trailers for the project and secured funding for the equipment. The company also has funding in place for start-up costs and equipment deposits through a $3.9 million shareholder loaning facility.
The Iron Ridge mineral resource, as announced in August 2019, is an indicated 10 million tonnes of ore at 64.3 per cent iron and an inferred 500,000 tonnes at 64.2 per cent iron, bringing he total resource estimate to 10.5 million tonnes.
Fenix expects to truck 1.25 million tonnes of ore per annum from the mine.
The company has estimated that a total of 350 full time equivalent (FTE) direct and indirect jobs will be created throughout the supply chain, including 70 FTEs on site at Iron Ridge.