FMG terminates ARF biodiesel contract

North Perth-based Australian Renewable Fuels says it has received a termination notice from Fortescue Metals Group regarding the supply of biodiesel to the Cloudbreak mine site in the Pilbara.

In September last year, both companies executed an agreement where ARF would supply a minimum of 5 million litres of biodiesel per annum over five years.

In a statement today, ARF said FMG has indicated it is reviewing their overall strategy in relation to fuel blending.

"ARF is currently reviewing all options in relation to the FMG review and an invitation by FMG to submit a new proposal," ARF said in a statement.

Further comment was being sought from ARF chief executive Max Ger at time of publishing.

ARF is the latest company to have its FMG contract terminated, with Brierty and NRW Holdings both having their contracts cancelled.

Shares in ARF shed 0.5 cents or 38.5 per cent to 0.8 cents while shares in FMG were up seven cents to $2.59 at 14:42 AEST.