Mineral sands-hopeful Sheffield Resources Ltd has entered a non-binding term sheet to form a JV with Hong Kong’s Yansteel on the Thunderbird project in Western Australia’s north-west.
For an investment of $130.1 million Yansteel can acquire 50% of Thunderbird, while there is a take or pay clause for it to off-take 100% of ilmenite production in stage one.
Sheffield remains engaged with project financing partners Taurus and the Australian Government Northern Australian Infrastructure Facility to finalise the overall funding package for Thunderbird.
Should the JV with Yansteel proceed, Sheffield will have locked in equity to build stage one of Thunderbird.
Sheffield managing director Bruce McFadzean said:
“Whilst the Joint Venture would now progress a BFS based on a flowsheet to produce a zircon-rich non-magnetic concentrate and a high quality LTR Ilmenite product, the 2019 BFS update estimated an after-tax NPV8 of $980m [refer ASX announcement dated 31 July 2019 “BFS Update Materially Improves Project Economics”] and the JV transaction commences the journey of realising this value for Sheffield shareholders.”