Sundance inks offtake agreement with Noble
PERTH (miningweekly.com) – Iron-ore developer Sundance Resources has signed a ten-year offtake agreement with commodities trader Noble Resources over its Mbalam-Nabeba project, on the border between Cameroon and the Republic of Congo.
MD Giullio Casello said the offtake contract would meet the requirements of financiers, and would help to ensure that the project secured the necessary funding.
“This contract represents another key step in our strategy to develop the Mbalam-Nabeba project. Having Noble sign such an extensive sales agreement is a huge vote of confidence in the project, and we believe it will give financiers the comfort they need to provide debt funding.”
Under the terms of the offtake agreement, Noble would purchase all product produced for the first ten years of the operation, outside of the product allocated to the project equity participants, which currently accounted for up to 50% of production.
The sales would be based on international standard pricing benchmarks. Noble would organise the sales, freight logistics and shipping of the ore.
Sundance was currently targeting production of 35-million tonnes a year at Mbalam-Nabeba, with the project expected to have a minimum mine life of 25 years.
Stage 1 of the operation, which would have a mine life of ten years, would be focused on producing direct shipping ore hematite, while the second stage of the operation would be the continued production of itabirite hematite concentrate.
Sundance said the company was making continued progress on the engineering, procurement and construction (EPC) tender process for the development of port and rail infrastructure for the project. An exclusivity agreement with a preferred bidder would likely be completed by the June quarter.
The mine plant EPC tender process was also continuing.
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