Gindalbie finalises second offtake deal

Gindalbie Metals has finalised its second long-term offtake contract with joint venture partner Ansteel, this time covering the hematite production from the Karara iron ore project in the Mid West.

Last month, Gindablie and Ansteel sealed one of Australia's largest ever binding trade deals, a $US65 billion iron ore sales contract covering the life-of-mine production from the Karara magnetite project.

The latest contract covers the total hematite production from Karara, which is scheduled to start mid next year.

The offtake allows for sale of hematite volumes up to 3 million tonnes each year.

The pricing structure for hematite will be based on the Hamersley Iron Pilbara lump and fines (FOB) benchmark price.

"We are very pleased to conclude all the offtake agreements from the Karara Project," Gindalbie managing director Garret Dixon said.

"The hematite in particular provides KML early cashflow while we commission the magnetite operations. This agreement further demonstrates the significant progress we are making at Karara and the value of having a quality partner in AnSteel."