logo-loader

Fenix Resources hits 9-year high on securing port access at Geraldton for iron ore exports

Last updated: 16:26 03 Dec 2020 AEDT, First published: 10:26 03 Dec 2020 AEDT

Fenix Resources Ltd - Fenix Resources secures port access at Geraldton for iron ore exports
The company is on-track to begin production this month and exports early in 2021.

Fenix Resources Ltd (ASX:FEX) has passed a key milestone on the road to exporting from the Iron Ridge Iron Ore Project early in 2021 after executing Port Lease and Port Access and Services agreements for the use of Geraldton Port.

The binding agreements with Mid West Ports Authority (MWPA) secure a port allocation of 1.25 million tonnes per annum of iron ore to be exported utilising the Berth 5 shiploader.

These key agreements follow the purchase of port infrastructure at Geraldton Port in October 2020 and pave the way for first production this month and first export sales early in the new year.

Investors responded well with shares as much as 34% higher today to 22.7 cents, a new high of more than nine years.

Apart from strong recent newsflow for Fenix, the increase in price from 12 cents at the market close on November 2 can also be attributed to strong iron ore prices and positive future fundamentals.

“Significant commercial agreements”

Fenix managing director Rob Brierley said: “We have been working closely with MWPA for well over a year, and it has now culminated into significant commercial agreements that enable Fenix to commence iron ore production and to export its first shipment of product early in the new year.

"We are thankful for the cooperation and support we have received from Dr Rochelle Macdonald and her team and we look forward to being a customer of MWPA for many years to come.”

The initial term of the agreement is four years, with two additional two-year extensions able to be triggered at Fenix’s election.

Infrastructure purchase finalised

Fenix has made further progress in its export plans with settlement of the purchase of port infrastructure from Sinosteel Midwest Corporation now finalised.

The flagship 100%-owned Iron Ridge Project, which is around 490 kilometres by road from the port, has been in development since September and is due to start mining, crushing and screening, and road transport operations this month.

Premium DSO deposit

It is a premium DSO deposit which hosts a JORC 2012-compliant indicated and inferred resource of 10.5 million tonnes at 64.2% iron with low impurities and a 7.76 million tonnes probable ore reserve at 63.9% iron.

High-grade iron ore attracts a premium price on the seaborne market as Chinese steelworks increasingly demand more pure inputs with lower emissions due to increasingly strict government regulations.

Only requiring crushing and screening, 1.25 million tonnes of ore per annum is proposed to be trucked to the port by a JV signed off in May 2019, with trucking specialist Newhaul Pty Ltd headed by respected logistics expert Craig Mitchell who was the founder and owner of Mitchell Corp before selling to Toll Group.

Poseidon Nickel signs binding agreement with Mineral Resources to divest...

Departing Poseidon Nickel Ltd (ASX:POS, OTC:PSDNF) CEO Craig Jones and incoming CEO Brendan Shalders join Proactive’s Jonathan Jackson to discuss the divestment of Lake Johnston to Mineral Resources Ltd (ASX:MIN). Jones, who has played a pivotal role in this strategic move, shared insights on...

6 hours, 16 minutes ago