The purchase price of iron ore is calculated on the basis of an agreed minimum tonnage of 2.4 million tonnes (assuming delivery begins at the end of June 2013), i.e. a transaction value of approximately AUD 38 million. Under the agreement, Mineral Resources will operate the mine until the end of the mine`s life, while Moly will retain its contractual and legal obligations as a tenant. Holdingigns of Iron Ore (ASX:IOH) has secured the sale of iron ore ores with mineral resources (ASX:MIN) that will lead to the early development of its Iron Valley project. The purchase of mineral resources seriously jeopardizes the project and puts it on the road to commercialization. Under the terms of the agreement, Mineral Resources will develop the mine at its own expense within 6 months, after the iron ore has obtained final approval for mining, which is expected early in the third quarter of this year. Mineral Resources will operate the mine and purchase a minimum annual tonnage of iron ore proceeds at the mine gate. The iron ore will remain the owner of the rental home and will make all legal payments to third parties, including the government. The contract expires in 20 years or with the purchase of 200 million tons of products purchased by Mineral Resources, depending on what happens first. The Iron Valley project is strategically located in the eastern part of the Pilbara Iron Ore Central Hub and in close proximity to existing infrastructure. It is drilled by properties leased by Fortescue Metals Group (ASX:FMG), Rio Tinto (ASX:RTO) and BHP Billiton (ASX:BHP).
Iron Valley has a CARBONE reserve (2004) of 134 million tonnes for an average of 58.5% fe based on a JORC (2004) mineral resource of 259 million tonnes. It has already secured a native title contract and the federal government`s environmental approval for the project. In addition, the state government`s approval for the mining of 5 million tonnes of water mirrors per year from the Iron Valley has been guaranteed, while a second mine application is under way below groundwater levels. Secondary applications, including a proposal from the Department of Mines and Petroleum Mining, the Department of Environment and Conservation Building Permits and the Department of Water Licences, are pending. Proactive Investors Australia is the leading producer of information, articles and research reports on ASX “Small and Mid-Cap” shares with distribution in Australia, the United Kingdom, North America and Hong Kong/China. A preliminary study conducted in 2005 showed that the project has an annual production of 15,000 to 20,000 tonnes of copper cathode for a lifespan of more than 10 years. Recent drilling results have significantly improved the profitability of the project. On May 10, 2013, the two moly mines limited (Moly) listed on ASX and TSX announced that they had agreed with Mineral Resources Limited (Mineral Resources) to sell iron ore to Molys Spinifex Ridge Iron Ore Mine. Moly Mines (TSX: MOL) says it has reached an agreement with Mineral Resources Limited today to sell the iron ore business produced at the Spinifex Ridge Iron Ore mine. Current estimates put the purchase price at approximately AUD 38 million.