nothing concrete yet, but charles is at work..

Bloomberg about 2 seconds ago.......love puff.


Aurox in China Talks to Secure Funding for A$1 Billion Ore Mine


By Jesse Riseborough

July 17 (Bloomberg) -- Aurox Resources Ltd., an Australian iron ore company, is in talks with a Chinese steel mill to secure funding for a A$1 billion ($803 million) project.

“We have been back and forth to China, we are talking to some pretty obvious groups with regards to coming in as more than just” customers for the planned mine in Western Australia, Charles Schaus, managing director of the Perth-based company, said in an interview. He declined to name the mill.

Chinese mills are investing in Australia to secure ore supplies to feed rising demand for steel. China’s economy grew 7.9 percent in the second quarter from a year earlier after the government implemented a 4 trillion yuan ($585 billion) stimulus plan that’s sucking in raw materials from around the globe.

“Money is flowing into the junior end of iron ore share markets, with many exploration and development companies undertaking equity raisings,” Trent Allen, an iron ore analyst at Resource Capital Research, said today in a report. “There are continuing signs of recovery in the iron ore sector.”

Aurox was unchanged at 32 cents at 11:35 a.m. Sydney time on the Australian stock exchange.

The company has signed sales agreements with Hebei Iron & Steel Group, China’s second-largest mill, and closely held Chinese steelmaker RockCheck Steel Group.

Schaus will visit China next week for further talks with the unnamed mill and aims to secure an investment agreement by the end of the year, he said in an interview yesterday.

Talks involve a possible joint venture partnership in the project and an equity stake in the company, Schaus said. The partner would be responsible for securing debt funding, he said.

Expansion Study

The company is seeking to start shipments at an annual rate of 6 million metric tons of magnetite iron ore concentrate by March 2012, he said. It’s studying an expansion to 10 million tons a year by 2014, he said.

RockCheck, based in Tianjin, has agreed to buy 3 million tons of output annually for 15 years while Hebei has also agreed to buy 3 million tons a year. RockCheck also owns an 11.5 percent stake in Aurox and has agreed to buy the additional 4 million tons of output once the expansion is complete.

A review of the construction costs for the mine started this month and the estimate may decline by between 10 percent and 15 percent, Schaus said. Aurox plans to pipe output 110 kilometers (69 miles) from its Balla Balla mine site to Port Hedland in northern Western Australia for shipping.