roper river

A THREE-MAN Territory company has made $15 million on an Outback mining tenement %u2014 and could make up to $50 million more.

Darwin-based North Australian Iron Ore Pty Limited has signed a deal with Perth investment and exploration firm Batavia Mining.

Batavia will get 100 per cent of the shares in the Territory junior explorer, which has an exploration licence over 3500 square kilometres of land at Roper River, 475km southeast of Darwin.

The tenement ? and an adjoining prospect ? are being hailed as the next Pilbara, although the resource has yet to be firmed up.

In return, North Australian Iron Ore will get $15 million in cash, 150 million shares in Batavia and an option for 100 million more shares.

It will also receive 4.5c per tonne of ore during mining. North Australian head Jerry Ren said:

"This is more a merger than a sellout."

He said the Roper iron ore mine could be the biggest investment project in Territory history.

Western Desert Resources owns a massive tenement next door.

The two operations are investigating how to export the iron ore.

The main option is to transport the ore as slurry by pipe or barge about 100 kilometres to Port Roper.

Both companies are believed to be in negotiations with the Territory Government about building a bulk loader at the port.

"It's called Port Roper but there's nothing there," Mr Ren said. "We would have to build it."

Much of the ore at the Roper is high grade.

The lower-grade material would be beneficiated ? washed to improve its quality.

Mr Ren said mining could begin within two years.

Japanese company Itochu has bought a share of Western Desert Resources.

It also tried to buy a stake in North Australian Iron Ore ? but the overtures were rejected in favour of Batavia.