Heron Resources Limited (“Heron” or the “Company”) is pleased to announce that it has entered into an off-take agreement for the zinc, copper and lead concentrates to be produced from its wholly-owned Woodlawn Zinc-Copper Project (“Project”) located near Tarago, 250km southwest of Sydney, New South Wales, Australia.
Louis Dreyfus Company Metals (“LDC Metals”) has been awarded the base metal concentrate off-take from the Woodlawn Project from commencement of production through to the end of 2021, a period of approximately three and a quarter years. The off-take contract covers 100% of the zinc, copper and lead concentrates to be produced over this period.
Heron Resources Managing Director and CEO, Mr Wayne Taylor, commented:
“Over the past 12 months we have run a highly competitive process for the much-sought after concentrates from the Woodlawn Project, and we are very pleased to have reached an agreement with LDC Metals, a large and experienced concentrate trader with an excellent reputation in the market. Zinc concentrates are particularly in short supply in the global marketplace, which is expected to remain tight for the next few years, and this has resulted in the company agreeing attractive commercial terms for 100% of mine output during the critical first few years of production at Woodlawn”
Once at steady state, the Woodlawn Project is expected to produce approximately 70,000dmt (dry metric tonnes) of zinc concentrates, 30,000dmt of copper concentrates, and 25,000dmt of lead concentrates annually from the processing of a combination of underground ore and reclaimed tailings ore. In addition to revenue being provided from the primary metal in each of the concentrates (zinc, copper and lead), by-product revenue will be generated by the gold and silver content in the lead and copper concentrates.
The off-take with LDC Metals is a key milestone in the Company’s pre-financing activities and contemplates the shipment of Woodlawn concentrates from either Port Kembla or Port Botany in lot sizes that will allow the Company to manage working capital requirements as well as securing bulk shipping freight rates. It is anticipated that the Woodlawn concentrates will be destined for further processing to final metal in major Asian markets.
LDC Metals CEO, Mr Paul Akroyd, commented:
“We are very pleased to be able to partner up with Heron Resources and support them for the development of the Woodlawn Project. This is fully aligned with our strategy to build upon our existing Australian activity and continue to provide solutions for the needs of the Australian mining industry”