Venture Minerals (ASX: VMS) is looking to ride the latest wave of high iron ore prices after nailing a port access agreement with TasPorts to use the wharf at Burnie on the Tasmania’s north coast for export shipments from its planned Riley mine.
This follows another agreement last month that will allow the company to truck through ground owned by Hydro Tasmania.
Two full years of mine production are covered by an offtake agreement with Prosperity Steel of Singapore, one of the largest iron ore traders in the world. Riley will be exporting direct-shipping ore.
TasPorts owns the wharf and infrastructure at the port of Burnie and Venture says the access agreement, together with the deal with Hydro Tasmania, means it has secured the entire pathway from mine gate to shipping.
“This effectively means that mining can commence immediately subject to the completion of financing,” the company stated.
On-site infrastructure at the Riley mine is complete, meaning that ore mining and dry screening can begin at short notice. The iron ore begins at surface which means a zero-strip ratio.
Venture said it is pressing on with debt financing options to enable the first shipment to move as early as next month. The funding will provide the working capital necessary to sustain mining operations and to finish construction of the wet screening plant.
The road haulage tender process is near completion. Hydro Tasmania is allowing 21km of its roading to be used from the mine site, making for all-bitumen road haulage route to Burnie.
Transition to iron ore miner
Managing director Andrew Radonjic said the Riley iron ore mine will create close to 100 jobs and will boost the economy of Tasmania’s west coast region during what he called “unprecedented times”.
“This continues to be an exciting phase for the company and its shareholders as [Venture] moves from explorer to producer,” he added.
Venture said iron ore prices remain at “historically significant levels” having recently hit 10-month highs.
Furthermore, demand remains strong due to Chinese infrastructure spending while there are supply concerns from Brazil due to the COVID-19 situation there (with infections in Brazil now totalling 1.66 million and deaths so far passing 66,700).
The Riley mine has been on care and maintenance since 2014.
Venture had planned to begin production then but faced ongoing appeals that halted the mine’s approvals process and also meant it missed a period of high iron ore prices.