THE BOURSE WHISPERER: Sheffield Resources (ASX: SFX) advanced offtake arrangements for the company’s 100 per cent-owned Thunderbird mineral sands project in northern Western Australia.
Sheffield Resources announced the signing of a cornerstone non-binding Memorandum of Understanding (MoU) for the future sale of high-quality low temperature roast (LTR) ilmenite.
The company explained the LTR ilmenite MoU was secured with Chinese manufacturing entity CNNC Huayuan Titanium Dioxide Co. Ltd (CHTi), which invests in the research, development and production of titanium dioxide and iron oxide pigments.
Sheffield said the agreement with CHTi represents approximately 45 per cent of the estimated total volume of LTR ilmenite to be produced from Stage 1 of the Thunderbird project.
This MoU follows a succession of agreements executed by Sheffield in April 2017 in relation to the Thunderbird premium zircon and zircon concentrate products, confirming Thunderbird as a world class mineral sands project capable of producing global sized annualised volumes of zircon and ilmenite over a 42 year mine life.
“Sheffield Resources welcomes CHTi as a cornerstone customer for our high-quality Thunderbird LTR ilmenite product,” Sheffield Resources managing director Bruce McFadzean said in the company’s announcement to the Australian Securities Exchange.
“Coupled with the zircon MoUs executed earlier this quarter, this agreement confirms Sheffield’s high-quality product capability when in production.
“The recently completed Thunderbird Bankable Feasibility Study showed LTR ilmenite will generate 29 per cent of the estimated project revenue.
“We look forward to concluding a binding offtake agreement with CHTi and establishing a long-term business relationship going forward.
“The industry is seeing sustained improvement in zircon and ilmenite commodity prices throughout 2017.
“We are pleased with the market demand shown for the range of products to be produced from Thunderbird, and we are equally pleased by the progress being made on financing arrangements.”