State-owned mining company NMDC has entered into an agreement with Minemakers Limited, to develop the Australia-based mining company's Wonarah Phosphate deposit in the Northern Territory.
The Wonarah Rock Phosphate project is Australia's largest undeveloped, phosphate deposit holding an estimated 1.25 billion tonnes of the key raw material needed by the fertiliser industry.
Although both companies have not disclosed the project cost, a few days ago, the Australian Financial Review had indicated that it would cost around A$1.5 billion to develop the Wonarah project.
Under the deal, NMDC and West Perth-based Minemakers will undertake a joint feasibility study for the full development of Wonarah, which includes a mine and downstream processing facilities to produce beneficiated rock phosphate for export, phosphoric acid, and finished fertiliser products.
Following the feasibility study, both companies will enter into a joint venture, where NMDC will acquire a 50-per cent stake in the Wonarah Project. NMDC will arrange project finance for the full development of Wonarah, by way of debt finance and repay the costs already incurred on the project by Minemakers to date.
''Minemakers is very pleased with this potential financial pathway to developing Wonarah. Wonarah is Australia's largest known phosphate deposit and a partner of the scale of NMDC brings the financial and marketing capacity to allow the project to be developed to its full potential,'' said Andrew Drummond, Minemakers' managing director.