IMX Resources (ASX:IXR) is expected to kick off the exportation of Cairn Hill magnetite ore through Port Adelaide in the second quarter of 2010 after Flinders Ports granted the company a shipping licence.
The grant is a major milestone for IMX, with all approvals and licences required for the mining and export of Cairn Hill ore having now been obtained.
Following the announcement, shares in the Perth-based company increased 2c, or 6.9%, to 31c.
Phase I of the Cairn Hill magnetite – copper – gold development will involve direct shipment of ore to China. The first shipment of iron ore could occur within four months of completion of appropriate financing – which is currently being negotiated.
The container terminal operator, DP World Adelaide, has been issued the bulk shipping export licence for the export of Cairn Hill ore by the South Australian Environmental Protection Authority. The transfer of ore onto the vessel is governed by a number of environmental compliance conditions.
Flinders Ports, DP World Adelaide and IMX have worked extensively with the regulatory authorities to develop a system which is world’s best practice in respect of the elimination of dust emissions during transport, storage and loading of the high grade magnetite ore.
IMX Managing Director Duncan McBain said the shipping licence was an important milestone for IMX and its shareholders, as it is the final external approval for the Cairn Hill development.
"Our aim is to complete financing arrangements by the end of this year and now look forward to the prospect of our first shipment of ore in the latter part of the second quarter of 2010," Mr McBain said.
“The ability to commence export operations during the second quarter of 2010 will transform IMX form an exploration company to a producer and place IMX in a strong position to benefit from the expected commodity price improvements in 2010."
IMX is negotiating the service agreement for the port operations with Flinders Ports / DP World Adelaide, based on the detailed Heads of Agreement signed in May 2009.
In parallel with the shipping licence application, IMX (in conjunction with container leasing company Cronos) has constructed a prototype of the ¾ height 20 foot container, to be used for rail transport, storage and loading of the ore, for testing and certification.
Mr McBain said the custom-designed container had now been certified for the carriage of 35 tonnes of ore, which had the potential to reduce rail access charges by reducing the number of wagons per train to achieve the same capacity.
“The certification of a container with a 35 tonne net capacity is very significant as most containers are certified at around 19 tonnes," Mr McBain said.
"The assistance of Flinders Ports and Cronos with the design of the container in assisting IMX achieve this outcome has been critical."
The immediate upside for Cairn Hill, located 55 kilometres south-east of Coober Pedy in South Australia, remains the definition of further resources to support a long term 3-5mtpa operation.
IMX Resources is listed on the Australian Stock Exchange (ASX) with a current market capitalisation of approximately $52m.