todays west australian

Found this in todays West.

Not quite over the line yet, but if you believe what you read it should not be a problem, and GBG has a bright future. This thing cannot fall over too much money already put in. Shares are always a risk but if this one does I am stuffed!!!! R & R

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Gindalbie Metals says it is on course to start using a $US1.2 billion ($1.3 billion) Chinese debt line from May to fund the Karara magnetite project, despite hinting yesterday it may struggle to meet a self-imposed deadline to finalise the term sheet.

Construction of the $1.8 billion project in the Mid-West is already under way although completion relies on securing debt from China Development Bank and Bank of China.

Gindalbie had hoped to secure the debt by April 9.

Managing director Garret Dixon said yesterday that even if the deadline was not met, the target of first draw-downs in May remained on track.

Mr Dixon was speaking after Gindalbie announced it had finalised a magnetite concentrate offtake deal with AnSteel, which along with the debt was the key condition standing in the way of Karara's development.

AnSteel has agreed to pay a premium to the Pilbara fines benchmark for Karara's ore, which Mr Dixon said would be of higher iron content (68.2 per cent versus 62-63 per cent) and lower impurities than Pilbara fines.

First deliveries are earmarked for late next year, with Karara's start-up profile of eight million tonnes a year to increase to 30mtpa by 2020.

Mr Dixon would not disclose the size of the premium, although analysts at UBS have forecast it to be 20 per cent on the Pilbara hematite fines benchmark price. The premium is valid for Karara's mine life, with Gindalbie claiming it to be worth more than $US65 billion over 30 years.

Mr Dixon said the fact the benchmark pricing system was under pressure would not adversely affect the Karara offtake deal because AnSteel was committed to following the prevailing Pilbara fines price.

The AnSteel offtake is further good news for Murchison Metals and Mitsubishi Development, the proponents of the Oakajee port and rail network.

Their joint venture, Oakajee Port and Rail (OPR), yesterday handed a draft bankable feasibility study to the WA Government. OPR said the project should cost $4.4 billion, compared to an earlier estimate of $4 billion, although the scope has changed from a one berth, 35mtpa port to two berths and 45mtpa.