Column: China’s commodity import trend driven by prices, not economy
China's imports of major commodities are often viewed through the prism of the performance of, and outlook for, the world's second-biggest economy.
IMX Resources Ltd. (TSX: IXR) announced this week the company has formed a joint-venture agreement with Hong Kong based MMG Limited (HK: MMG) to advance the Ntaka Hill Nickel Project located in Tanzania.
Terms of the agreement call for MMG to incur $60 million in expenditures over a five year period in exchange for a 60% interest in the Ntaka Hill Project. The agreement also gives MMG the option to acquire an additional 20% interest upon delivery of a Bankable Feasibility Study (BFS) and additional cash payments.
“We are delighted to welcome MMG as our partner to test for deeper, high-grade mafic intrusive style nickel mineralisation at Ntaka Hill and to build on our success to date,” said IMX Managing Director Neil Meadows in the news release. “The deeper exploration program lends itself to a partnership with a large company like MMG to manage the higher cost of such a program, but also to bring to bear additional technical capability.”
The Ntaka Hill Nickel Project contains global National Instrument (NI) 43-101 compliant measured and indicated resources of 20.3 million tonnes grading 0.58% nickel. An additional 35.9 million tonnes grading 0.66% nickel currently reside in the inferred category.
IMX acquired the Nachingwea Regional Project in 2012 as part of its acquisition of Continental Nickel. To date nearly 300 diamond holes spanning over 50,000 meters have been drilled into Ntaka Hill.
IMX released assay results on September 11th from drilling completed over the summer at Ntaka. The drill program, which tested for outlying extensions of the deposit, highlighted 1.2 meters of 1.12% nickel in drill hole NAD13-353 and 21.4 meters of 0.4% nickel in hole NAD13-354.
The joint-venture agreement calls for MMG to immediately become project operator. MMG has plans to shift the exploration focus at Ntaka to test for potential higher-grade mineralization at depth.
Regional exploration will also continue at Nachingwea. IMX has identified over seven kilometers of prospective ultramafic rocks within its land holdings which it believes could host additional massive and disseminated nickel and copper mineralization.
In addition to its Tanzanian holdings, IMX also has a 51% interest in the Cairn Hill Mine located in South Australia. The mine has been in operation since 2010 and has shipped over four million tonnes of high-grade magnetite and copper ore through direct shipping operations.
The company has projected cash flow guidance of $34 million during full year 2013 from Cairn Hill. Additionally, IMX announced in March that the joint-venture would begin testing for copper and gold mineralization at Cairn Hill.
Shares of IMX Resources are traded on the TSX under the ticker symbol IXR and the company also retains an ASX listing under the same symbol. The company has 396 million shares outstanding and holds a market cap of $39.6 million as of Friday’s close.
