TNG Ltd now has binding offtake agreements for two of its trifecta of metals to be produced from the Mount Peake vanadium-titanium-iron project in the Northern Territory, after reaching a deal with Swiss global specialty chemical distributor DKSH.
DKSH has agreed to purchase, on a life-of-mine basis, up to 100% of TNG’s titanium dioxide products produced at the project.
The Swiss company will provide full distribution services, including freight financing, technical support, logistics, marketing and sales for the products.
The two companies had agreed to a binding term sheet for the offtake in October last year.
A binding offtake agreement is already in place with South Korea’s Woojin for at least 60% of the project’s vanadium output.
Further negotiations are underway for offtake of the remaining 40% of the project’s vanadium and a binding term sheet is already in place with major global commodity trader Gunvor for iron products, though the company is also in talks with other iron ore buyers.
TNG will initially produce a high-durability titanium dioxide pigment for the outdoor coating industry before expanding to other high-value niche markets.
It recently applied to trade mark the unique colouring dye that is generated from the TIVAN process due to its particular “whiteness” that is caused by the very low iron content of the ore feedstock.
Managing Director Paul Burton said: “We have now converted the previously announced Binding Term Sheet with DKSH into a binding off-take agreement within the timeframe that we set – which is a great achievement for TNG, our shareholders and the Mount Peake project.”
“DKSH is a great fit for us given the technological breakthrough we achieved last year with our ability to produce titanium dioxide pigments. “
“With our final environmental assessment and permitting milestones also making strong progress … the completion of this binding off-take agreement will add significant momentum to our funding and commercialisation strategy for Mount Peake.”
“We are also working on signing final binding off-take agreements in the coming months for both our vanadium pentoxide and iron products. Together with the front-end engineering and design work currently underway, these agreements will effectively underwrite our funding strategy for Mount Peake.”
Mount Peake has an ore reserve of 41.1 million tonnes grading 0.42% vanadium pentoxide, 7.99% titanium dioxide and 28% iron.
Ore from the project will be processed in Darwin using the company’s proprietary TIVAN process to produce 243,000 tonnes of high-purity vanadium pentoxide, 3.5 million tonnes of titanium dioxide pigment and 10.6 million tonnes of high-grade iron oxide during the initial 17-year mine life.
TIVAN is a method for treating ore without the need for expensive, energy-intensive roasting.
It has been used successfully to produce a 99% purity vanadium pentoxide, a high-grade titanium dioxide feedstock grading about 80% titanium dioxide and a 99.9% iron oxide product.
Germany’s KfW IPEX-Bank is leading a USD$600m debt raising to underpin the project’s development while metallurgical engineering company SMS Group is undertaking the front-end engineering and design work.
TNG also appointed Australian contractor McMahon Services to progress the program of work for the non-process infrastructure requirements for Mount Peake last week.