Macro Metals has announced that its subsidiary, Macro Mining Services (MMS), has been awarded a mining services contract by RE:GROUP for the Extension Iron Ore Project in Western Australia (WA).
Project Rusty, a privately held company, is the owner of the Extension Iron Ore Project, which covers an area of 27.6km².
The project is strategically located near Port Hedland in the Eastern Pilbara region and has an indicated mineral resource of 16.1 million tonnes (mt) at 54.2% iron.
Project Rusty has appointed RE:GROUP as the head mining services contractor, with MMS exclusively providing all technical services and performing crushing and screening under a build-own-operate model.
The contract involves MMS validating previous metallurgical test work, which indicated that 11.29mt of iron ore with a grade of 57.16% iron would be available after dry screening.
MMS will also engage with the Pilbara Ports Authority to secure an export allocation of 1.5–2 million tonnes per annum (mtpa) and assess the exploration potential of untested mineralisation outcrops to extend the mine’s life.
MMS will be compensated for its technical services, as well as for jointly performing mine site establishment, drilling and blasting, mining, and load and haul operations with RE:GROUP, on a cost-plus basis, with a 15% markup.
Macro directors Simon Rushton and Rob Jewson each hold a 27.3% share in Rusty. Subject to shareholder approval, Macro may acquire Rushton’s shares in Rusty, with the consideration being 175 million fully paid ordinary Macro shares.
Rushton said: “This life of mine, mining services contract with RE:GROUP locks in revenue and margins for our business and creates a very solid foundation for the contracting order book we are currently building.
“MMS’ scope of work under this contract is firmly aligned with the business model we are pursuing; namely that we look to perform as many aspects of the supply chain as possible from pit to customer.”
MMS is now preparing a detailed scope of work and cost estimation for the project, which includes securing final approvals, applying for bulk sample permitting, and developing the project execution plan.
The project execution plan includes using Macro’s logistics, accommodation and raw materials hub, located 28km east of Port Hedland’s Utah Point Bulk Handling Facility, for off-port stockpiling and potential product blending.
In July 2024, Macro Metals signed an agreement to earn an 80% interest in four manganese tenements in the Eastern Pilbara region of WA from Firebird Metals.
