Join our daily newsletter At The Bell to receive exclusive market insights
- Suvo Strategic Minerals (SUV) has begun negotiating the first offtake agreement for its White Cloud Kaolin Project in WA
- The kaolin producer’s subsidiary has signed a non-binding term sheet with C.M.M Toye Industrial Mineral Consultants
- Under the proposed agreement, Suvo will supply 10,000 tonnes per annum of high-grade kaolin from White Cloud at a price of $850 per tonne
- The two companies hope to have the offtake agreement signed by the end of December 2022, subject to commercial production getting underway
- Additionally, the term sheet also allows for a distribution agreement to be signed between the two companies in the future
- Shares in SUV are trading up 3.7 per cent at 14 cents
Suvo Strategic Minerals (SUV) has begun negotiating on the first offtake agreement for its White Cloud Kaolin Project in WA.
The kaolin producer and silica sand explorer announced on Monday that its subsidiary had signed a non-binding term sheet with C.M.M Toye Industrial Mineral Consultants (CMM).
The term sheet sets out a pathway for subsidiary Mt Marshall Kaolin and the specialist ceramics manufacturer to sign an offtake agreement, which would guarantee the supply of high-grade kaolin.
Specifically, Mt Marshall would supply 10,000 tonnes per annum of high-grade kaolin from White Cloud to CMM at $850 per tonne.
At this stage, the two companies hope to sign the offtake agreement by the end of December 2022, though the agreement is subject to commercial production beginning at Mt Marshall.
Meanwhile, along with the offtake agreement, the binding term sheet also sets out a path for Suvo and CMM to sign a distribution agreement.
Commenting on the term sheet, Suvo Executive Director Aaron Banks said this future agreement would be one of many.
“The entry into the term sheet with CMM to progress one of the many expected offtake agreements from our White Cloud project at this early stage validates not only the quality of our kaolin but the speed at which the company is systematically progressing this unique resource,” he said.
Shares in Suvo Strategic Minerals are trading up 3.7 per cent at 14 cents per share at 2:58 pm AEDT.
