Bauxite Resources in another China deal

Bauxite Resources has signed an initial agreement with a Chinese entity to explore options for direct equity investment and the joint development of an alumina processing plant in the South West.

The company and Yankuang Group Corporation, based in the Shandong Province in China, have signed a memorandum of understanding (MoU) to formalise a direction for the parties' relationship.

Bauxite has been in a number of talks with Yankuang over the past year.

Key targets of the MoU are to negotiate a direct equity investment in Bauxite through a share placement and enter into a heads of agreement for a joint venture for the alumina plant.

The plant is part of the Darling Range bauxite project in the South West.

"The MoU does not create any binding contractual obligations and Yankuang are continuing significant due diligence at a corporate and project level," Bauxite said.

Shares in Bauxite closed up two cents to 44.5c today.

This week, Bauxite received final regulatory approval for a $9.85 million placement with Shandong Provincial Bureau of Geology and Mineral Resources.

Funds will be used to fast-track development of the project.