Junior mining company Mindax is closer to its Mt Forrest iron investment after it received preliminary notice from a Hong Kong company that it will go ahead with the joint venture.
Hong Kong’s Perpetual Mining Holding said it will ensue with the Mt Forrest iron project after due diligence review.
Mindax’s managing director and CEO Dr Steve Ward said this is a step in the right direction for the iron project, according to Proactive Investors Australia.
“It has been good to work though due diligence with PMHL. Subject to PMHL Board approval, we look forward to finalising a formal JV agreement and driving the project forward with all pace,” he said.
PMHL’s non-binding notice is dependent on formal board approval within the next four weeks to go ahead with the transaction.
Final decision to go ahead will also depend on the negotiation and execution of a formal joint venture agreement, which the companies will finish as soon as possible.
The period of exclusivity between the two companies will be extended without further fees to give the companies time to finalise the joint venture agreement and other documents relating to the transaction.
Mindax signed a $52 million deal with Perpetual Mining in March. Perpetual Mining will spend the money on farm-in to accelerate development of the project.
A Memorandum of Understanding was signed by the parties to cover the terms.
This means Perpetual would attain a 51 percent interest in the direct shipping of ore from its Mount Forrest project in Western Australia’s Yilgarn region, and 49 percent of the magnetite rights.