Ironveld PLC (AIM:IRON) shares jumped 8% higher after it confirmed that a subsidiary has entered into a joint venture agreement with Pace SA (Pty) Limited as equal partners to produce and sell dense media separation (DMS) grade magnetite from Ironveld's mine in Limpopo, South Africa.
All the initial capital and establishment costs of approximately 35mln South African rand (£1.65mln) will be funded by Pace, with the maximum design capacity of the plant to be approximately 60 tonnes per hour, and first production and sales expected from mid-2023.
In a statement, Martin Eales, CEO of Ironveld, said: "This is an exciting and value additive transaction for Ironveld, which will utilise our existing mining infrastructure to supply extra quantities of ore, at multiples of the expected smelter requirements per month, to the JV from which we expect profitable cashflow within months."
In early morning trade on Friday, Ironveld shares rose 8.1% to 0.34p.