Strandline Resources has strengthened the development outlook for its Coburn mineral sands project in Western Australia by securing three long-term binding offtake agreements, representing approximately 66% of Coburn’s forecast revenue for the first five years of production.
The remaining project revenue is expected to be from the balance of premium finished zircon and rutile product (representing approximately 34% of forecast revenue). Offtake agreements for these remaining products are advancing well, noted the company.
Strandline Managing Director Luke Graham said the sales contracts marked a pivotal point in the strategy to bring Coburn into production.
“These contracts, with three leading global consumers, are huge endorsements of Coburn and underpin our plan to secure project funding,” Mr Graham said. “With two-thirds of the project’s revenue now underwritten by offtake agreements and the remaining agreements well advanced, Strandline is advancing strongly towards development of this world-class project.”
The three binding offtake agreements are as follows:
• 100% of the chloride ilmenite product for the first five years of production with The Chemours Company FC LLC, the world’s largest producer of high-quality titanium dioxide. The ilmenite sales are expected to generate between 20 to 24 per cent of Coburn’s total revenue, based on the pricing structure contained in the agreement.
• 100% of the zircon concentrate product for the first seven years of production with Sanxiang Advanced Materials Co. Ltd. and Nanjing Rzisources International Trading Co. Ltd., which are operating in strategic partnership. The zircon concentrate sales are expected to generate between 22 to 26 per cent of Coburn’s revenue, based on the pricing formulae contained in the agreement and TZMI’s commodity price assumptions contained in the Coburn DFS.
• Substantial portion of the premium (finished) zircon product for the first five years of production with Industrie Bitossi s.p.a, one of the world’s largest zircon consumers, based primarily in the high-quality European ceramics market. The zircon sales covered by the agreement are expected to generate approximately 18 per cent of Coburn’s forecast total revenue, based on the pricing structure contained in the agreement.
All three agreements are subject to conditions precedent regarding the development of the Coburn Project.