13/01/2016 - 15:21

Base offtake partner hits delays

13/01/2016 - 15:21

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Mineral sands miner Base Resources has received a force majeure notice from one of its offtake partners, which will affect an $US11.6 million ilmenite sales agreement.

Base Resources produces ilmenite from its Kwale mineral sands mine in Kenya.

Mineral sands miner Base Resources has received a force majeure notice from one of its offtake partners, which will affect an $US11.6 million ilmenite sales agreement.

In a statement today, Base said the notice was in response to “incidents that have occurred causing significant delays in commissioning the counterparty’s slag furnace”.

Base produces ilmenite from its Kwale mineral sands mine in Kenya.

“The notice, while providing a preliminary assessment of the extent of the damage caused by the incidents, advises that repairs, further damage assessment and rectification works will be required and that therefore the potential delay is not yet known,” Base said.

The counterparty was due to purchase about 100,000 tonnes of ilmenite by the end of June from Base at an average price of $US116/t.

“Base is continuing to assess the potential impacts of the notice, including the company’s rights,” it said.

“While Base reserves its rights in respect of the notice, the counterparty has committed to working with the company to seek to mitigate the potential impact of the notice.

“In the meantime, Base will also explore all available options for selling the ilmenite concerned to other customers.”

Base shares were unchanged at 4.8 cents each at the close.

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