East-Perth based Fox Resources Ltd has repaid the $4 million project loan for zinc concentrates from the West Whundo copper/zinc project from China's largest importer of iron ore, Sinosteel Australia.
Sinosteel provided Fox with a $4 million pre-payment in May 2007 for zinc concentrate sales from the company's West Whundo Copper Zinc mine in the Pilbara through an offtake agreement.
"It is prudent that the company maintains a position of being completely bank and project debt-free. It's encouraging to be able to repay Sinosteel early and we look forward to what 2008 has in store for our next phase of growth;" said managing director, Don Harper.
In addition to the West Whundo zinc offtake agreement with Sinosteel, Fox also has an offtake agreement with Jinchuan Group Ltd, China's largest nickel producer for all copper concentrate sales from the West Whundo.
Fox has also struck a deal with Pilbara mining giant Rio Tinto to mine the overburden at the Whundo copper/zinc project.
The waste from Whundo is being used for Rio's construction of a rail siding along its railway from Pannawonica to the Port of Dampier which bypasses the Whundo deposit.
Rio will excavate at no cost to Fox an estimated 300,000t of waste material covering the Whundo deposit.
Fox estimates a saving of up to $3 million in mining and rehabilitation costs. A re-evaluation of the economic upgrade rom the Whundo open pit which contains 11,000t of copper and 8,000t of zinc metal is underway.
The company has completed additional metallurgical drilling as part of the previously announced feasibility study on the West Whundo ore.
A causeway was built into the West Whundo pit from where diamond drilling into the stage one primary copper zinc ore was undertaken.
Previous metallurgical samples taken in early 2007 were not representative of the ore zone.
Metallurgical tests are currently being undertaken at the Ammtec laboratory in Perth with results expected next week.
