Sirius Resources Signs Nickel Offtake Agreement with Glencore

Sirius Resources NL (ASX:SIR) announced that it’s reached an agreement under which it will sell Glencore plc (LSE:GLEN) about half of its nickel sulfide production for a three-year period. The period will begin once production starts at the Nova mine in late 2016.
Interestingly, the agreement comes just days after Glencore sold two of its nickel projects.
As quoted in the press release:

Concentrate will be trucked by road from the Nova mine site to either Esperance or Geraldton port for export.
The commercial terms of the offtake agreement are confidential but, as with the previous two offtake agreements with BHP Billiton Nickel West and Trafigura, they reflect the anticipated exceptionally high quality of the Nova nickel and copper concentrates, which have very low levels of deleterious elements. The nickel concentrate also has an extremely high average Fe:MgO ratio of 62, which makes the product an ideal material to blend with other more high magnesium concentrates that are otherwise problematic for smelting.

Mark Bennett, managing director of Sirius, commented:

We are pleased to have completed the final part of our preferred offtake strategy with such an attractive offtake deal with Glencore. We have now secured offtake for all of Nova’s nickel and copper production for the first three years of the mine’s initial ten year life, and are looking forward to a productive relationship with Glencore.

Click here to read the full Sirius Resources NL (ASX:SIR) press release.