ASX-listed Fenix Resources has sealed a transformative 30-year right-to-mine agreement (RTMA) with Sinosteel Midwest Corporation (SMC), a subsidiary of China’s Baowu Steel Group, granting Fenix exclusive rights to mine and export iron-ore from the Weld Range project in Western Australia’s Mid-West region.
The landmark deal marks a significant expansion for Fenix, positioning the company to become a leading long-term producer in the Mid-West iron-ore sector.
290Mt Resource Secured
The Weld Range hematite project hosts a global mineral resource of 290-million tonnes (Mt) at an average grade of 56.8% iron, including the Beebyn-W11 deposit, which holds 20.5 Mt at 61.3% Fe. This deposit is already partly covered by an existing 10 Mt right-to-mine agreement between Fenix and SMC.
Under the new RTMA, Fenix commits to:
Maintain minimum production of 6 Mt per annum,
Target exports of 10 Mt per annum in collaboration with Baowu.
Deal Structure: Staged Payments + Royalties
The total consideration includes:
A$60-million in cash, paid over 24 months:
A$20-million upfront,
A$20-million on each of the following two anniversaries.
Production royalty: A$4 to A$5 per tonne,
Profit-share royalty: 10% to 15% of net profit after tax, depending on market iron-ore prices.
Once the consideration is paid, Fenix retains 100% of earnings from all ore sold under the RTMA.
Fenix executive chairperson John Welborn hailed the deal as a “game changer” for the company:
“Fenix has delivered on its strategy to unlock the value of the stranded iron-ore deposits of WA’s Mid-West. Securing 290-million tonnes of high-quality hematite adjacent to our operations is a major leap forward.”
He added that the Weld Range deal deepens Fenix’s partnership with Baowu and lays the foundation for long-term, large-scale growth.
Fenix has launched a feasibility study to integrate Weld Range with its:
Existing Iron Ridge and Beebyn-W11 mines,
Mid-West logistics, rail, and port infrastructure.
The company recently hit its FY2025 production target of 4 Mtpa, following the commissioning of its third mine. With Weld Range now in hand, Fenix aims to:
Expand production capacity significantly,
Boost operational efficiency,
Enhance profitability and mine life across its Mid-West operations.
The 30-year Weld Range RTMA represents a strategic coup for Fenix, not only unlocking one of the region’s most promising high-grade deposits, but also positioning the company to play a key role in Australia’s long-term iron-ore export future.
Main Image: Resources Review
