Australasian Resources (ARH), an Australian-based resource company, rose as much as 3.62% or 5.5 cents on Monday after it said CITIC Pacific has concluded agreements with Mineralogy and Professor Clive Palmer to acquire Korean Steel Pty Ltd.
Mineralogy is a private company which owns the extensive Balmoral deposit and from which Australasian had acquired rights to mine 1 billion tonnes of magnetite.
Under the agreement, Korean has the rights to develop a second 1 billion tonne project at Balmoral, in the Pilbara region of Western Australia. It has the right to mine 1 billion tonnes of magnetite ore.
Mineralogy chairman and Australasian major shareholder professor Clive Palmer has confirmed that the second 1 billion tonne project has been acquired by CITIC for over US$200 million plus ongoing annual royalty payments for Mineralogy.
"CITIC's decision emphasizes the quality of the Balmoral projects at Cape Preston. It underpins our belief that the area will become a world class iron ore province in the coming years," Australasian managing director Andrew Caruso said.
The company said ‘the inclusion of a second project increases planned export production for CITIC to 24 million tonnes per annum from the Central Block of the Balmoral Project, which is adjacent to Australasian's Balmoral South Project.
Under the agreement, CITIC will develop a port at Cape Preston, which Australasian will have access to on a capital and operating shared cost basis.
Just last week, Australasian said it secured further expansion into the mining, processing and infrastructure at its ‘world-class' Balmoral South Iron Ore Project.
Shares in Australasian rose by 6 cents to close at $1.58.
