Fortescue’s hiccup comes as CZR nears a funding deal for the...

Fortescue’s hiccup comes as CZR nears a funding deal for the company’s Robe Mesa iron ore operation in the Pilbara, with the company understood to be closing on a deal to sell part of the project to a private party in exchange for the development cash needed to bankroll its five-million-tonne-a-year project.CZR’s project is fully permitted and has an export route through a future transshipping operation at Ashburton in a joint venture with fellow Pilbara iron ore hopeful Strike Resources and shipping and logistics major CSL, not far from the new iron ore port planned by Mineral ResourcesThe company’s iron ore deposit is effectively an extension of Rio Tinto’s Mesa F deposit and the iron ore major has been heavily tipped as a future buyer of the asset, which contains a mining reserve of only 33.4 million tonnes of low grade ore.An October feasibility study put the capital requirements of CZR’s project at $109m.CZR suspended trading in its shares on Tuesday, citing a “corporate transaction” relating to the Robe Mesa project.

But while the market previously has linked both Rio and MinRes to deals for the Robe Mesa project, neither of the two majors are believed to be involved in the transaction.CZR finished September with only $1.3m in cash, but the company told shareholders in October negotiations over offtake and funding agreements with “global commodity traders” were well advanced. Industry sources say CZR is closing on a deal with a private counterparty that could see it sell down equity in the deposit, as well as taking a significant stake in the listed entity, in exchange for cash to help develop the deposit.CZR’s infrastructure partner Strike Resources suspended trading in its own shares on December 28 – the same day CZR called a trading halt – ahead of an announcement about a corporate transaction involving its own Pilbara iron ore assets, suggesting a deal involving both parties could be under negotiation.Legendary WA prospector Mark Creasy is CZR’s biggest shareholder, holding about 55 per cent of the company’s shares, along with a 15 per cent direct stake in the Robe Mesa projectCZR shares last traded at 21c, valuing it at $49.5m. Strike Resources shares last traded at 4.9c.