Venture Minerals has secured a binding iron ore offtake agreement with Singaporean company Prosperity Steel at the Riley mine in northwest Tasmania.
Prosperity Steel will purchase 100 per cent of the mine’s product for the first two years of production based on a reserve of 1.8 million tonnes of ore at 57 per cent iron content.
The news will no doubt come as a victory for Venture in its ongoing process to restart the Riley operation.
Venture originally intended to launch operations at the mine in 2013 but environmental appeals against the mine’s federal government approval led to delays and the mine was eventually placed on care and maintenance in August 2014.
Local environmental group Save the Tarkine objected to the approval coming at a time when the iron ore price had fallen considerably due to the mining downturn.
Now bolstered by an improved iron ore market that has enjoyed a peak of nearly $US100 ($143) a tonne this year, Venture embarked on a review to recommence production at the shuttered mine in February 2019.
Venture now only requires an update to the project’s mining study to allow for a decision to mine in “the coming weeks”, according to a company statement.
“The signing of the offtake agreement with a group of the calibre of Prosperity Steel, has strengthened the likelihood of the Riley iron ore mine moving into production,” Venture managing director Andrew Radonjic said.
“Venture looks forward to delivering the first shipment to our new partners at a positive time in the iron ore price cycle.”
Venture has two other mining projects in Tasmania, including its flagship Mt Lindsay tin-tungsten mine and Livingston iron mine, both of which are located near Riley.
The company also owns several other operations in Western Australia, including the Pingaring nickel-cobalt project, Caesar nickel-copper project and Odin and Thor prospects.
Internationally, the company is developing the Pak Yang and Thali prospects within the highly prospective Loei copper-gold belt in Thailand.