BC Iron holds a number of other earlier stage projects in Western Australia, which are prospective for a range of commodities including iron ore, gold, base metals and salt. The Company also holds four potential iron ore royalties in the Pilbara.
In 2016, BC Iron agreed to sell its 75% interest in the Nullagine Project to Fortescue Metals Group Limited (“Fortescue”). BC Iron retains a royalty on 75% on all future iron ore mined from Nullagine of:
- 1.0% to 2.0% of FOB revenue for ≥55% Fe iron ore; and
- A$0.50 to A$1.50 per tonne for <55% Fe iron ore, adjusted for 15% yield loss.
Fortescue will initially pay BC Iron 33% of the agreed royalty in cash, until the total amount waived by BC Iron equals A$7.5M. Thereafter, Fortescue will pay BC Iron 100% of the agreed royalty.
A 50% reduction in the royalty rate will apply to all iron ore mined above 15 million tonnes and a 75% reduction will apply to all iron ore mined above 25 million tonnes.
Koodaideri South Royalty
Koodaideri South forms part of the larger Rio Tinto proposed Koodaideri mine in the Central Pilbara. BC Iron is entitled to a royalty of 2% of FOB revenue on any ore mined from the Koodaideri South project area.
The Extension Project is owned by Australian Aboriginal Mining Corporation Limited (“AAMC”). BC Iron is entitled to a royalty of 1.25% to 2.50% of FOB revenue on any iron ore produced from the project.
AAMC has an option to purchase the Breakaway tenement which, if exercised, would result in BC Iron being entitled to a cash payment of A$3.75M and a royalty of 1.25% to 2.50% of FOB revenue on any iron ore produced from the project.
The Mardie tenements are located on the coast in the West Pilbara region, approximately 70km south west of Cape Preston East. The Mardie project area is likely to be suitable for production of salt via solar evaporation. BC Iron is currently completing a scoping study on a 3Mtpa operation.
The Maitland River tenement is located in the West Pilbara region, approximately 20km south east of Cape Preston East and within 5km of the North West Coastal Highway and the Bunbury to Dampier natural gas pipeline.
This deposit has a Mineral Resource of 1,106Mt @ 30.4% Fe which is hosted in three deposit areas. A concept study was completed in December 2012 (refer here for more details).