A wholly owned subsidiary of the Japanese trading company Sojitz Corporation has entered into a binding Joint Venture Implementation Agreement (JVIA) with Grange to become a 30% joint venture partner in the Southdown magnetite project in Western Australia.

Sojitz has agreed to purchase an initial 10% stake in the project for US$4 million and has agreed to spend a further US$10 million on pre-commitment development expenditure, for which it will earn a further 20% interest.

The involvement of Sojitz, a world leader in the iron ore pellet sector, is expected to provide a significant boost to the project. Grange and Azure Capital are continuing to negotiate with a number of significant international companies regarding participation in the project.

Southdown is about 90km north-east of the port of Albany on the south coast of Western Australia and the magnetite deposit represents the largest known magnetite deposit of its kind in the south of the state.

The resource base is 479.1 million tonnes containing 37.3% magnetite grading 69.2% iron. The development plan is to mine the Southdown magnetite deposit using proven open pit mining methods with the magnetite mineralization being crushed, ground, screened and then magnetically separated to produce a magnetite concentrate at a planned production rate of 6.6 million tonnes per year.