Yansteel has received commonwealth approval for a $130 million acquisition of a half share in the Thunderbird mineral sands project in Western Australia from Sheffield Resources.
The two companies signed a joint venture (JV) agreement for Yansteel to acquire a 50 per cent stake in Thunderbird during August.
Yansteel’s acquisition will provide funds to support stage one of the Thunderbird project and build a 10.4 million tonnes a year mine and process plant.
Sheffield stated that the favourable outcome from the Foreign Investment Review Board (FIRB) process represented a critical milestone for the formation of the JV and ultimately the development of Thunderbird.
“The advice from FIRB is a positive step forward for Yansteel, Sheffield and the development of the Thunderbird mineral sands project,” Sheffield managing director Bruce McFadzean said.
“It is a significant event for shareholders and the Kimberley community, demonstrating state and federal governments’ support for continued investment in the local resources sector.”
With the FIRB process completed, there would be no other regulatory approvals required for the proposed acquisition.
The JV will include four directors on the board, with Sheffield and Yansteel each nominating two directors, while operating as a standalone entity.
Both partners expect to finalise their agreements over the coming weeks before moving to complete the final bankable feasibility study for Thunderbird. This will eventuate in a final investment decision next year.
The Thunderbird project hosts one of the largest and highest grade mineral sands discoveries in the last 30 years.
It will deliver a zircon rich non-magnetic concentrate and ilmenite that are suitable for manufacturing titanium dioxide pigment or smelting into chloride slag.
Yansteel is a subsidiary of manufacturing giant Tangshan Yanshan Iron & Steel Co – a producer of around 10 million tonnes a year of steel products – via Hong Kong-based private company YanGang Co.