BCI and Sinosteel in MOU

Perth-based BCI Minerals has signed a non-binding memorandum of understanding with Chinese steel producer Sinosteel to assess potential development of BCI’s Buckland project in the Pilbara.

The agreement provides a framework for potential binding agreements regarding marketing and offtake, engineering services and funding, and joint venture structures.

The framework includes Sinosteel facilitating discussions with BCI and potential funding partners and joint venture investment from the Chinese company.

The Buckland project comprises proposed mines, a private haul road and a new port at Cape Preston East.

The company is planning a 20 million tonnes per annum port with BCI aiming to create a multi-commodity, multi-user port that exports 15mtpa of iron ore, 3mpta of salt and 2mtpa of other products.

Sinosteel has been a partner with Rio Tinto for 30 years in the Channar Mining joint venture, which has produced more than 250mt of iron ore.

BCI managing director Alwyn Vorster praised the credentials of Sinosteel.

"Involving a credible and experienced partner such as Sinosteel provides momentum to the development of the Buckland Project,” he said

“Sinosteel has a long and successful history of partnering in Pilbara iron ore projects and we look forward to working with them to ensure that potential joint venture, offtake, development and funding arrangements can be progressed in a mutually beneficial manner."

Sinosteel Midwest, a subsidiary of Sinosteel, recently had an application to expand its mothballed Blue Hills iron project east of Geraldton approved by the state government.

Phase one of that project produced 9mt of iron ore over a five-year period with the next phase expected to produce 7mtpa for 25 years.

Shares in BCI were up 5.7 per cent to 18.5 cents at 130pm AEDT.