The Agata joint venture between TVI Pacific and Mindoro Resources has completed the second shipment of high iron/low nickel direct shipping ore (DSO) produced from the Agata project in northern Mindanao.
The Agata project is held by Agata Mining Ventures (AMVI), a joint venture company owned 40% by Mindoro and 60% by the project operator, TVI Resource Development (Phils) (TVIRD).
A shipment of 55,499 wet metric tonnes (wmt) of limonite ore, containing 0.84% nickel and 49% iron, left the port of Payong-Payong in Agusan del Norte, Mindanao, on November 10, 2014, in accordance with an offtake arrangement between TVIRD and Tewoo Hoperay (Singapore) Pte Ltd. AMVI expects to receive gross revenue of US$916,000 for the shipment, pending final assay and price adjustments.
AMVI reports that production remains steady and stockpiled inventory to date is approximately 36,896 wmt of limonite with content levels of 0.9% nickel and 49% iron. Future shipments of approximately 55,000 wmt of DSO material are anticipated to continue approximately every three to four weeks.
AMVI signed an offtake agreement in June 2014 with Tewoo Hoperay (Singapore), a subsidiary of Tianjjn Hoperay Mineral Limited Company, a major Chinese State Owned Enterprise, to sell one million wmt of high-iron/low nickel DSO and a second agreement was signed in August 2014 to sell 500,000 wmt. Advance payments of US$3 million were received by AMVI to fund initial operating costs.
The project is in Agusan del Norte province, within the Surigao mining region, which is a major lateritic nickel producing region providing ore to processing plants in Australia, China, Korea and Japan.
The project is well located and is expected to benefit from its deep protected seaport, the opportunity for year-round shipping and its proximity to main markets in Asia.
Meanwhile, AMVI has received a Letter of Advice from China Banking Corporation granting an US$8 million term loan facility to support its DSO operations and exploration work at the Agata project.
“The ability of the Agata joint venture to secure this substantial funding should send a positive signal to the market,” says Mindoro’s CEO Penny Gould. “With the high-iron DSO operations now under way, this further funding will allow the joint venture to unlock additional value from the Agata project through increasing the high-iron DSO production, updating the nickel laterite resource, and commencing work on the limestone DSO project.”