Article by Matt McKenzie courtesy of Business News.
Hancock Prospecting’s plan to earn-in to a slice of a Yilgarn magnetite project is proceeding, with the deal finalised just days after a new trade agreement with India.
ASX-listed Legacy Iron Ore told markets today that its previously announced agreement with Gina Rinehart’s Hancock to develop the Mt Bevan mine had been executed, following the completion of a due diligence process.
Legacy holds 60 per cent of the project and is largely controlled by Indian government enterprise National Mineral Development Corporation.
The company and its partner Hawthorne Resources first announced the $9 million deal with Hancock in November.
Hancock was to pay $8 million cash to Legacy and Hawthorne and chip in $1 million more for working capital to take a 30 per cent share.
It will fund a pre-feasibility study, with Atlas Iron – owned by Hancock – to be the manager of the joint venture.
A completed study will take Hancock to 51 per cent ownership of the project.
Mt Bevan could be a $5 billion development, with the magnetite used as an input in Indian steel mills.
Hancock chief executive Garry Korte said the business looked forward to collaborating with joint venture partners on the feasibility study.
“This is an excellent opportunity for Hancock and could provide options for additional higher grade, lower impurity iron ore products,” Mr Korte said.