Fenix raises $15m for Iron Ridge

Fenix Resources is on track with development of its low-cost, high-grade iron ore project in Western Australia, after receiving commitments to raise $15 million.

Fenix said its 7.76 million tonne Iron Ridge project in WA’s Murchison region was now fully funded, with the placement proceeds to fund initial capital costs outlined in a feasibility study released last year, including an 82-person camp and crushing and screening facilities.

Capital costs were estimated to be around $11.4 million.

The West Perth-based company, whose sole project is Iron Ridge, said the direct shipping ore (DSO) deposit would generate significant cash flow and financial returns.

Iron Ridge holds a net present value of $54.3 million, and will generate $16.4 million annually over a six-year mine life, as outlined in the feasibility study.

Fenix has forecast production of 1.25 million tonnes per annum, with cash operating costs estimated to be $76.86 per dry metric tonne. First ore shipping is targeted for early next year.

Managing director Robert Brierley today said Fenix was ready to begin developing the project.

“Iron Ridge is a simple DSO project, which is set to generate very strong cash flow on the back of its shallow ore, proximity to port, high grades and robust margins based on the strong prevailing iron ore pricing environment,” he said.

Fenix, which had received strong support for the placement, will issue around 103.5 million shares in two tranches, at an issue price of 14.5 cents per share.

The placement is being managed by Hartleys.

Fenix was down 5.7 per cent at 3:33pm AEST to trade at 16 cents per share.