Mineral Resources and Hexagon Resources have signed a joint venture agreement over the McIntosh graphite project in northern Western Australia.
Hexagon said the execution de-risked the project’s development funding and stage one feasibility for the company.
MinRes – the project manager and financier – has completed its initial farm-in expenditure of $300,000, giving it a 51 per cent stake in McIntosh.
Hexagon managing director Mike Rosenstreich said, “The signing of this agreement effectively de-risks the project for Hexagon’s shareholders, having a company with the financial capacity and operational skills such as MinRes involved.
“To date, MinRes has certainly been very active on the ground, with a major drilling program recently completed, yielding a series of positive preliminary outcomes and approximately 17 tonnes of drill core samples recovered. We look forward to the results of this program as soon as possible.”
MinRes is required to undertake feasibility studies within 18 months and commence development work within 24 months.
First commercial production is scheduled within 36 months – before mid-April 2021.
MinRes will provide all mining, processing and logistical services for McIntosh over the life of mine.
Meanwhile, Hexagon will remain involved in the geology, resource delineation and field logistics, as well as participating in Native Title negotiations, as the two companies announced in a joint statement last July.
The JV was approved by Hexagon shareholders in May, and was expected to take effect in August.
Rosenstreich, speaking at the Graphite+Anodes event in California last month, said, “We are looking to market 50,000 tonnes of concentrate flake,” which the company expects to convert into multiple different products.