Red Hill Iron and API dispute iron ore rights at West Pilbara

Red Hill Iron and API dispute iron ore rights at West Pilbara

Red Hill Iron (ASX: RHI) contends that 589 million tonnes of the expanded Stage 1 JORC Mineral Resource estimate for the West Pilbara Iron Ore Project (WPIOP), representing 86% of total Stage 1 resources, are owned by the Red Hill Iron Ore Joint Venture (RHIOJV).

On 1 November 2010, Aquila Resources (ASX: AQA) announced the above increase at Stage 1, which is managed by API Management Pty Ltd (API).

The two major components of the increase are 117 million tonnes at the Kens Bore East channel iron deposit and 34 million tonnes at Kens Bore itself. The new estimate lifts Stage 1 resources by 40% to 687 million tonnes.

The balance of the Stage 1 resources lies within the contiguous Mt Stuart Joint Venture in which Red Hill Iron Limited has no interest.

The RHIOJV Agreement was executed by Red Hill Iron and API in November 2005.

The tenements upon which the Kens Bore East CID is located are the subject of an agreement for the acquisition of iron ore rights made in February 2006 between API and the holder, De Beers Australia Exploration Limited.

Red Hill Iron contends that these tenements fall within the boundaries of the RHIOJV and that it is entitled to an interest of 40% reducing to 20% in any iron ore discovered in the area of the tenements.

Red Hill Iron and API disagree on the rights to ownership of the iron ore rights in the De Beers tenements and meetings of the parties to discuss their differences have been held following the delivery of a Dispute Notice by Red Hill Iron pursuant to the provisions of the RHIOJV Agreement.

To date these discussions have not produced agreement between the parties and Red Hill Iron is currently considering the next step in the process to establish its right to a share of the CID Resources at Kens Bore East.

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June 24 2015
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January 30 2013

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