Mineral sands company Sheffield Resources has agreed to sell a 50 per cent-stake in its flagship Thunderbird project to an entity based in Hong Kong.
Mineral sands company Sheffield Resources has agreed to sell a 50 per cent-stake in its flagship Thunderbird project to an entity based in Hong Kong.
The zircon and ilmenite-rich project is located on the Dampier Peninsula, in Western Australia’s Canning Basin.
Sheffield intends to form a joint venture with Yangang subsidiary YGH Australia investment, which will spend $130.1 million to acquire a 50 per cent project interest.
The news sent Sheffield up by as much as 67 per cent on the ASX today, with the West Perth-based company trading at 36 cents at 10am AEST.
Yangang has also agreed to buy all of the ilmenite produced in Stage 1, with Sheffield having already secured offtakes for forecast zircon revenue, as well as subscribe for around $12.9 million worth of Sheffield shares.
Managing director Bruce McFadzean said the agreements would provide enough equity to fund the first stage of Thunderbird, which involves a 10.4 million tonnes per annum mine and processing plant producing a zircon-rich, non-magnetic concentrate and LTR ilmenite product.
It will operate as a standalone entity with its own management and employees.
“To attract such a strong partner is testimony to the quality of the Thunderbird mineral sands project,” Mr McFadzean said.
“This outcome achieves all the objectives of the strategic partner process undertaken by Sheffield over the past 18 months and, if completed, will provide the means by which Sheffield shareholders can realise the underlying value of the project.”
He said the joint venture would now progress to a bankable feasibility study.
The Thunderbird project, estimated to generate $750 million in revenue, is also expected to be a major development for the Kimberley region, providing around 400 construction jobs and 200 local operational jobs for 37 years.
The owner of Yangang – Tangshan Yanshan Iron & Steel – said it shared the same commitment as Sheffield in protecting the environment, along with creating employment and business opportunities for Indigenous communities.
“We are supportive of the strong social license and stakeholder engagement undertaken by Sheffield through the study, approvals and project financing processes,” Tangshan Yanshan said.
Shieffield, which also owns the Eneabba and McCalls mineral sands projects in WA, was trading 53 per cent higher at 12:57pm AEST to 33 cents per share.
