Cromarty Resources signs offtake agreements for Thalanga project
Australian mining company Red River Resources' subsidiary Cromarty Resources has signed zinc and lead offtake agreements for production from its Thalanga Zinc project in Queensland.
The agreements were signed with Trafigura and are expected to reduce Red River’s working capital requirements, offering 122,000 dry metric tonnes of zinc concentrate and 27,400 dry metric tonnes of lead concentrate.
Red River Resources managing director Mel Palancian said: “The execution of zinc and lead concentrate offtake agreements with Trafigura is the culmination of a competitive process involving a number of leading trading and smelting companies.
“The highly competitive nature of the process has allowed us to obtain outstanding offtake terms for both zinc and lead concentrates, which will contribute to the success of Thalanga.”
The concentrates are scheduled to be shipped within 36 months following the commencement of commercial production at the Thalanga project.
Trafigura will also offer Cromarty up to $10m towards costs associated with production and general working capital expenditure as part of the facility agreement.
Red River noted that the project's pre-production capital cost is expected to be roughly $17.2m.
The project has an initial mine life of five years and is estimated to have an average production of 21,400t of zinc, 3,600t of copper, 5,000t of lead, 2,000oz of gold and 370,000oz of silver in concentrate per year.