- Grange Resources (GRR) is set to re-acquire its joint venture (JV) partner’s 30 per cent interest in the Southdown magnetite project in Western Australia
- The company is paying an undisclosed cash amount for SRT Australia’s stake and, once the transaction is complete, will own 100 per cent of the Southdown project
- Additionally, Grange Resources entered an agreement with Japanese company Sojitz for the offtake of up to 30 per cent of future production from Southdown
- Grange is currently undertaking a definitive feasibility study for the magnetite project which it intends to complete by the end of Q1 2023
- GRR shares are down 3.7 per cent to trade at 91 cents at 12:28 pm AEDT
Grange Resources (GRR) is set to re-acquire its joint venture (JV) partner’s 30 per cent interest in the Southdown magnetite project in Western Australia.
The company entered a binding agreement with its JV partner, SRT Australia, to acquire its stake in the project. This would effectively take Grange’s total interest in the Southdown project to 100 per cent.
Grange’s CEO, Honglin Zhao, said acquiring the remaining interest is the “beginning of a new chapter” for the project, as well as for the company.
“Southdown is a world-class magnetite deposit with the potential to deliver high-grade concentrate with low impurities, which would make the product suitable for direct reduction (DR) grade iron ore pellets,” Mr Zhao said.
“These attributes and specifications are expected to be in strong demand as the product can greatly contribute to the reduction of carbon emissions in the steel manufacturing process and provide an important ingredient in the production of green steel.”
Grange Resources will pay SRT an undisclosed cash amount for its 30 per cent stake and will provide it with the right to future offtake and cancellation of future royalty obligations.
The company also entered an agreement with Sojitz Corporation who will offtake up to 30 per cent of future production from Southdown at market prices for an initial 20-year period.
Grange completed a pre-feasibility study for the project earlier this year and is currently undertaking a definitive feasibility study (DFS).
The DFS is progressing designs for optimising site layout, metallurgical testwork and pilot plant trials using dry grinding techniques, port marine operations and transhipping methodology.
The company expects to complete the DFS by the end of the first quarter of 2023.
GRR shares were down 3.7 per cent to trade at 91 cents at 12:28 pm AEDT.