The MoU is non-binding and the negotiations for the agreement of the JV are at an advanced stage.
Legend Mining managing director, Mark Wilson, said he is looking forward to working closely with Posco over the coming months to finalise an exploration joint venture agreement.
Mr Wilson said: "Posco’s given a tick to the sovereign risk of Cameroon, a big tick to our project."
The Ngovoyang project, owned by Legend Mining, is located halfway between the major cities of Douala and Yaounde.
Drilling diamond essays released in November show commercially significant intercepts of 116.2m at 26.2% iron, including 79.1m at 29.7% iron; and 80.5m at 36.6% iron.
South Korea-based steel producer Posco showed interest in the Ngovayang Project because of its proximity to infrastructure, including road, rail, port and airports, according to Legend Mining.