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Atlas to export Pilgangoora lithium direct shipping ore to Sinosteel

Atlas Iron Ltd. said March 2 that it agreed to export direct shipping ore sourced from the Pilgangoora lithium project to Sinosteel Australia Pty. Ltd.

Pilbara Minerals Ltd. owns the Western Australia-based Pilgangoora project.

In December 2017, Atlas entered a deal with Pilbara to supply 100,000 tonnes of direct shipping ore per month to off-take customers.

Atlas will sell up to 1.5 million tonnes of direct shipping ore to Sinosteel over a 15-month period on a fixed priced basis. The first exports are expected to begin in the June quarter.

As part of the arrangement, Sinosteel will advance funds to cover prepayments due to Pilbara for mine development costs. Pilbara is expediting the Pilgangoora mining program for the direct shipping ore.

After allowing for payments to Pilbara Minerals and its own costs, Atlas expects to generate an operating margin of between US$15 and US$20 per tonne.

The company will process and transport the ore using its existing infrastructure, including the Mount Dove crushing hub and Utah Point facilities in Western Australia.