Magnetite secures Japanese support for green iron project

Magnetite Mines has secured Japanese financial support for its plans to develop a massive green iron ore mine and potential green iron or steel production near Port Pirie in South Australia.

The company has signed a non-binding Heads of Agreement with JFE Shoji Australia, a subsidiary of JFE Shoji Corporation and part of the JFE Holdings trading house.

MGT and JFE will now negotiate a binding transaction which will see JFE provide funding towards the completion of the Razorback Iron Ore Project Definitive Feasibility Study (DFS).

Magnetite Mines is developing two billion tonnes of probable magnetite ore reserves in the Braemar iron region of South Australia, 240km north of Adelaide.

The company proposes a mine and is considering potential green iron production utilising magnetite ores which is most suitable for direct reduction technologies utilising hydrogen.

Magnetite Mines Chief Executive Officer Tim Dobson said: “Over the past year, Magnetite Mines has established a strong relationship with JFE Shoji Australia (and) we are delighted to formalise our collaborative efforts today, the culmination of a comprehensive due diligence effort and the first stage of what we envisage will be a long and prosperous relationship for both parties.”

In exchange for funding JFE would receive “DR-grade” magnetite concentrate production offtake rights for up to 10 percent of planned Project Stage 1 production at Razorback over a 15-year term.

JFE has the option to convert the offtake rights to equity or joint venture participation in the project.

JFE Shoji Australia Managing Director Koichi Sawada said: “Through our due diligence we have gained a good understanding of the Razorback deposit and we see tremendous opportunity in this project that is highly aligned with our strategic priorities, including supporting global efforts to decarbonise steelmaking.”

South Australian Minister for Energy and Mining Tom Koutsantonis said the state had a key advantage with abundant magnetite resources, which ‘presents the opportunity for the state to be at the vanguard of efforts to meet the world’s increasing demand for green iron’.

Further reading:
Now Port Pirie plans to be a green iron production hub

Picture: Magnetite Resources