Australian metals miner Metro Mining Limited made its investors aware of the execution of a non-binding Memorandum of Understanding (MoU) involving the supply of bauxite ore to the People’s Republic of China’s state-owned State Power Investment Corporation (SPIC) Aluminium and Electric Power Investment Co. Ltd.
Per Metro’s press release, the MoU contemplates providing SPIC with 6.5 million metric tons of bauxite ore across four years commencing in May 2018. Though the agreement in question is not binding upon either party, Metro advises that a binding Offtake Agreement between the two sides is currently being hammered out.
Metro points out that this agreement follows an Offtake Agreement for 7 million metric tons per annum with SPIC compatriot Xinfa as well as a non-binding Letter of Intent (LoI) entered into with China’s Lubei Chemicals. According to Metro, these agreements will cover the entirety of the company’s bauxite output for the next two years as well as fully 90 percent of the contemplated expanded capacity planned for 2020 and 2021.
The bauxite provided SPIC under the deal will be used to fuel its 2.5 million metric tons per annum of aluminium-smelting capacity and 2.6 million metric tons per annum of alumina-refining capacity.
Metro’s managing director Simon Finnis greeted the agreement as proof positive of the firm’s current business strategies.
“Once again this demonstrates the strong appetite for our bauxite in the Chinese refining market, and validates our mining and marketing strategy.
“Construction at the Bauxite Hills Mine is virtually complete, and is on schedule to commence production in April 2018, following the end of the Cape York wet season.”
Metro Mining is based in Brisbane, and began life when it was spun off from Cape Alumina Ltd. upon its takeover by MetroCoal Ltd in 2014. The firm has exploration rights in over 500 square miles of western Cape York, which is second to only Rio Tinto Alcan.