Iron Valley is an operating mine located in the Central Pilbara, which is being operated by Mineral Resources Limited (“MIN”) under royalty-type agreement. As at 30 June 2019, Iron Valley’s Mineral Resource was 189.9Mt at 58.0% Fe and its Ore Reserve was 89.0Mt at 58.3% Fe (refer here for more details).
Iron Valley commenced exports in October 2014 and is generating royalty-type earnings for BCI. It is a relatively simple DSO operation which produces both lump and fines, which are hauled to Port Hedland utilising road trains and exported via Utah Point. It has a mine life of greater than 10 years based on current production rates of 6-7Mtpa.
MIN operates the mine entirely at its cost and purchases Iron Valley product from BC Iron at a price linked to MIN’s realised sale price. BCI retains ownership of the tenements and certain statutory obligations, including payment of royalties.
BCI’s annual EBITDA from Iron Valley has ranged from A$6M to A$18M since operations commenced. FY20 is on track to be a record annual result for BCI, with EBITDA for the first 9 months of A$19.5M.