Mindax’s Mt Forrest Acquisition Hinges on Funding and Approvals

Mindax Secures Strategic Option

Mindax Limited has taken a significant step toward full ownership of the Mt Forrest magnetite iron ore project by executing an Option Deed with Norton Goldfields. This agreement grants Mindax the right to acquire Norton’s 35% stake in the joint venture, potentially consolidating Mindax’s control over the project to 100%. The option price is set at A$26.24 million plus interest, with a five-year window for exercise.

A Resource of Scale in a Prime Location

Mt Forrest is situated in the highly prospective Yilgarn province within Western Australia’s Mid-West region, an area known for its mineral wealth. The project encompasses seven mining leases and a granted water licence, underpinning its development potential. Notably, the project boasts a JORC-compliant mineral resource estimate exceeding 1 billion tonnes of magnetite iron ore at an average grade of 33.67% heavy iron, positioning it as a substantial asset in the iron ore sector.

Funding and Approvals, Key Hurdles Ahead

The exercise of the option is contingent on several critical conditions, including shareholder and regulatory approvals, as well as a successful equity capital raise or the structuring of a trade sale to secure a development partner. Mindax plans to leverage its existing ASX Listing Rule 7.1 capacity for equity raising but may seek additional shareholder approval if required. This layered funding approach reflects the company’s strategic intent to advance the project while managing financial risk.

Strategic Vision for the Mid-West Region

Mindax’s chairman, Benjamin Chow, highlighted the company’s broader ambition to transform the Mid-West region into a significant iron ore production hub. The company is actively exploring opportunities to consolidate iron ore interests in the area, aiming to achieve the critical mass necessary to support infrastructure development, including a potential slurry pipeline to the coast. Such infrastructure would facilitate efficient transhipment and export to Asian markets, enhancing the project’s commercial viability.

Looking Forward

While the option agreement marks a pivotal milestone, the path to full ownership and project development remains subject to execution risks. The coming months will be critical as Mindax seeks to secure funding and approvals, and potentially attract partners with the capacity to bring Mt Forrest into production. The company’s ability to navigate these challenges will be closely watched by investors and industry observers alike.