Fe Ltd signs letter of intent with contractor Big Yellow as West Wiluna JWD Iron Ore Project nears production

Fe Ltd (ASX:FEL) (FRA:B4T) has signalled its intention to appoint emerging mining contractor Big Yellow as mining contractor for the West Wiluna JWD Iron Ore project in WA, which is approaching production. A letter of intent (LOI) has been signed with Big Yellow and FEL expects the full contract to be completed within the next 30 days, subject to receipt of necessary environmental approvals and logistic contracts. The LOI will enable Big Yellow to allocate the necessary mining fleet and people to the project. Well advanced with approvals, key contracts FEL executive chairman Tony Sage said: "With mining at Wiluna close to commencing, we are pleased to have advised Big Yellow of our intention to appoint them as our mining contractor. “We are well advanced with the final approvals and other key contracts and would anticipate being able to update shareholders on these shortly.” Team is strengthened FEL has also welcomed two key team members - Eric Kiely and Stephen Danti – further strengthening its management team in the lead-up to production. Kiely joins the team as study manager and Danti as environment and land access manager. Sage said: “It’s fantastic to have the experience of Eric and Stephen joining our experienced management team, led by Mark Hancock and Jeremy Sinclair. “We believe we are building a team with a level of execution and development capability that will differentiate us in the junior iron ore space.” Big Yellow Big Yellow is a new contractor founded by experienced mining executives Brad Gordon, the former chief executive officer of Acacia and Intrepid, David Edwards and Mitch Wallace, both formerly from MACA. FEL believes that Big Yellow’s combination of experienced personnel looking to replicate their past success in a new entity is a good fit with FEL’s own aspirations to do the same and looks forward to continuing to work together. Early works activities Following the execution of the LOI, discussions have commenced on works that can be started in advance of final environmental approvals being received. The approvals received to date allow certain clearing and preparatory works to occur, along with refurbishment of the existing office facilities on site. These early works will allow a faster ramp-up of operations once the remaining approvals and key contracts are secured. Mine plan optimisation FEL has revisited the JWD geological model and mine plan, with opportunities identified for a reduction in the strip ratio and an improved average Fe head grade. If successfully implemented, this would have a positive impact on margin through reduced mining costs and improved pricing as a result of higher grade products than initially expected. Finalising optimal offtake Lump premiums for high-grade high iron such as that at JWD have been trading in the order of 50 US cents per dry metric tonne unit (per unit of iron) during the month to date. This implies an uplift to the JWD realised price over the quoted Platts headline fines price in excess of US$30 per tonne if the lump premium remains at these levels. The company has a number of parties interested in securing the JWD product and is working to finalise the optimal offtake arrangement utilising the company’s extensive industry contracts. New appointments Eric Kiely will ultimately focus on the Yarram project, however in the interim, his operational and mine planning experience will be leveraged for the start-up of JWD. He has over 30 years’ experience in the mining industry, with senior roles in mine planning and technical roles spending time in operations in gold, coal, iron ore and lithium. Kiely has a strong background in strategic mine planning and was responsible for the development of the Rio Tinto strategic mine plans for their iron ore business in Western Australia during their significant expansion between 2005 and 2013. He has significant leadership experience as a general manager in Rio Tinto, Atlas Iron and Altura Lithium, responsible for the mining technical functions including geology, geotechnical, metallurgy, hydrogeology and mine planning. Stephen Danti has comprehensive knowledge of the WA environmental approvals system and has successfully managed the environmental approvals and operational compliance for several large mining companies. He has worked for a number of government agencies such as the Department of Mines, Industry Regulation and Safety (DMIRS), Department of Water and Environmental Regulation (DWER), Office of Environmental Protection Authority (OEPA) and Department of Biodiversity, Conservation and Attractions (DBCA), consulting companies and in the private sector, and has extensive experience in environmental impact assessments, environmental approvals/compliance, land access, tenement management and stakeholder engagement.