Shares in Fenix Resources rise on deal with China | Australian Markets
Fenix Resources has beefed up its fledgling Mid West iron ore empire after putting a $60 million deal with the world’s largest steelmaker.
The settlement with China Baowu offers Fenix the unique proper for 30 years to mine Weld Range, which is about 500km inland from Geraldton and spreads throughout 40km of mining tenements.
The expansive tenure incorporates 290 million tonnes of ore at a grade of 56.8 per cent iron, with about 99mt at a 60.3 per cent iron grade cut-off.
Fenix can pay China Baowu $60m in equal instalments over two years for the correct to mine Weld Range, which envelops Fenix’s Iron Ridge and Beebyn-W11 mines.
Once Weld Range is in manufacturing, Baowu is owed a manufacturing royalty of between $4 and $5 per dry metric tonne, in addition to 10 per cent of web income from the mine if the iron ore price is under $US100 per tonne and 15 per cent of web income if it’s above $US100/t.
Shares in Fenix surged on the deal — up 12.5 per cent to 36¢, marking its highest stock price since September final yr.
“Securing 290 million tonnes of high-quality hematite direct shipping iron ore immediately surrounding our existing operations in the Weld Range is a game changer for Fenix,” Fenix government chairman John Welborn stated.
“Aligned with our aspiration to become a 10 million tonne per annum iron ore producer, this value accretive right to mine agreement provides the inventory we need to maximise the value of our exceptional transport infrastructure and materially expand our operations and extend our mine life.
“Having recently achieved our goal of successfully commissioning our third iron ore mine and attaining our targeted production run rate of 4 million tonnes per annum during 2025, the Fenix team now have the exciting opportunity to extend our ambitions.”
Fenix shipped first ore from Beebyn-W11 two weeks in the past and restarted the Shine mine final yr.
It scooped up Shine from Mt Gibson Iron in 2023 as half of a $25m bundle deal alongside with two rail sidings and two Geraldton Port storage sheds.
Fenix in complete has three sheds at Geraldton Port to store the ore payload transported by its fleet of 70 quad highway trains.
The company final week unveiled web revenue of $5.4m for the 2025 financial yr, down from the $33.6m produced in FY2024, which Fenix stated mirrored decrease iron ore costs and better depreciation from its fleet growth and mine development bills.
It had $56.8m of money by June 30.
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