Shougang Concord International Enterprises Co. Ltd. will pass its off-take rights on Mount Gibson Iron Ltd.'s Koolan Island mine in Western Australia to Hong Kong-listed Newton Resources Ltd., according to a June 3 news release.
Shougang Concord International and SCIT Trading Ltd. will novate their respective interests as guarantor and buyer under the existing off-take agreement, under which it agreed to purchase 80% of available iron ore produced from Koolan Island, to Newton and its Ace Profit Investment Ltd. subsidiary.
Shougang Group Co. Ltd., the controlling shareholder of Shougang Concord, is restructuring its iron ore interests through Newton, of which it owns about 27.5%, after completing a strategic review.
In addition, Newton's 28.7% shareholder, VMS Investment Group Ltd., will provide a US$75 million guarantee to Ace's obligations as buyer.
The Australia-listed miner said in April that it will resume shipments of high-grade ore from its Koolan Island iron ore operation after two years of redevelopment and refurbishment work at the site.