Fe Limited sells Pilbara exploration tenements to focus on advanced iron ore projects

Fe Limited (ASX:FEL) has entered two separate binding agreements with Global Lithium Ltd (ASX:GL1) and Mercury Resources Group Pty Ltd to dispose of its Pilbara exploration tenure for a total cash consideration of $550,000 - with a trailing royalty on certain of the tenements. Tenements E45/4724 and E45/4669 have been sold to Global Lithium for $350,000 in cash, with GL1 to assume the existing third-party royalty obligation on the tenements. Mercury Resources have purchased tenements E45/4690, E45/4691, E45/4759 and E45/4746 for $200,000 in cash and will pay a 1% Net Smelter Royalty to FEL on any product sales which occurs from the tenement package in the future. FEL will continue to manage the Mercury tenements in return for a management fee. “Focusing on advanced iron ore projects” The company will now focus all funding and effort on its advanced iron ore projects, having last week fired the first blast of ore and waste in the JWD Iron Ore Project pit as part of early development. FEL executive chairman Tony Sage said: “This transaction is consistent with our desire to focus our efforts and funds on our advanced iron projects. “We are pleased to conclude these transactions which liberate funds for FEL while allowing Global Lithium to consolidate their landholding in the Marble Bar region. “We look forward to continuing to support Mercury by managing their tenement position.” FEL has sold the tenements in white-blue labels to Global Lithium. First blast fired at JWD The company recently fired the first blast at JWD Iron Ore Project pit, which contains high grade hematite that is outcropping at surface and will form part of early crusher feed for the plant. Drill and blast will continue along strike, building broken stocks ahead of the commencement of mining load and haul operations. The company’s aim is to get the product to market as soon as possible to take advantage of the elevated iron ore price. The 62% index price remains robust and the lump premium at historic highs of US$0.70 per dry metric tonne unit – which would imply a current premium of around US$45 per tonne for the JWD product.