Mount Gibson Iron has entered into a life of mine agreement with Glencore International, for the sale of iron ore from the Extension Hill Hematite deposit in Western Australia.

Under the terms of the agreement, Glencore will purchase 48% of life of mine production, which is equivalent to about 1.44Mtpa, at production rates of 3Mtpa.

The Extension Hill Hematite deposit has total probable reserves of 12.8Mt and resources of 19.5Mt.

Mount Gibson Iron’s managing director Luke Tonkin said that, with this agreement, about half of Extension Hill production is under contract and that the firm will anticipate concluding further agreements in respect of remaining unallocated tonnages.