BC Iron and Fortescue Metals’ 50:50 Nullagine joint venture has obtained $50m in pre-payments as part of an off-take agreement, which will be utilised for project finance.

The agreement with a Hong Kong trading company involves the supply of 20 million tonnes of iron ore in the next eight years from the project members, and will enable the project to reach production in late 2010.

The pre-payments will be used for project development, with the initial tranche of $15m slated to be drawn next month and the remaining amount spread across 2010.