Fenix Resources has entered into a strategic alliance with trucking and logistics company Minehaul that will advance development of the Iron Ridge project in the Mid West region of Western Australia.
The companies will form a 50/50 joint venture company that will be known as Premium Minehaul, with the intention of Minehaul providing all trucking services to the operation.
Iron Ridge is approximately 490 kilometres by road from Geraldton Port, meaning a large proportion of operating costs will be related to road transport and logistics.
Minehaul is set to also make an investment in Fenix as part of a broader $1.25 million share placement, with funding contributing to Fenix’s expected equity contributions to the joint venture in order to achieve production-ready status.
The trucking and logistics company has demonstrated its support of Fenix, subscribing for $250,000 worth of new shares as part of a larger placement of 22.75 million shares.
It forms part of the $1.25 million Fenix intends to raise, which it has received firm commitments for.
Craig Mitchell has been elected as chairman and chief executive officer of the JV company, bringing a wealth of experience to the company, according to Fenix managing director Robert Brierley.
“Significant benefits include reduction and transparency of trucking costs, greater control over the logistics chain, reduction in the initial capital outlay and, most importantly, by introducing Craig Mitchell into the operations the company stands to benefit significantly from his extensive experience in the industry,” he said.