Fortescue Metals Group subsidiary FMG Magnetite has approved the development of stage 2 of the Iron Bridge magnetite project with joint-venture partner Formosa Steel IB.
Fortescue Metals Group (ASX:FMG,OTCQX:FSUGY) subsidiary FMG Magnetite has approved the development of stage 2 of the Iron Bridge magnetite project with joint-venture partner Formosa Steel IB.
As highlighted in the press release:
- Total Stage 2 capital costs of US$2.6 billion. The UJV partners are each responsible for their equity share of total capital expenditure for Stage 2. FMG IB’s capital contribution will be US$2.1 billion inclusive of US$274 million deferred contributions from Stage 1.
- Fortescue will manage and operate the Project with full marketing rights, supporting Fortescue’s strategy of a majority of products greater than 60 percent iron content. The actual product mix will be based on market conditions to deliver the greatest value to Fortescue and its partners.
- Annual production of 22 million wet metric tonnes per annum (wmtpa) once full operational capacity is achieved (equivalent to 20 million dry metric tonnes per annum (dmtpa)).
- Production of a 67 percent iron content, low impurity concentrate suitable for pellet feed or blending with sinter fines, expected to price at a premium relative to the Platts 65 Index. Five binding off-take agreements have been concluded for 5.3 mtpa.
- Delivery of first ore expected in the first half of calendar year 2022, with ramp up to full production within 12 months.
Elizabeth Gaines, Fortescue’s CEO, commented:
“The Iron Bridge Project holds Australia’s largest JORC compliant magnetite resource supporting a long mine life. The successful delivery of the Project by the joint venture partners is underpinned by Fortescue’s unparalleled track record and capability in safely developing and operating major iron ore projects in the Pilbara.”
“We are confident this project will deliver growth in earnings and cashflow, resulting in enhanced returns to our shareholders and our joint venture partners through all market cycles.”