Mayur Resources Limited (Mayur) is pleased to announce the signing of a Binding Term Sheet Agreement with Pacific Unison Holdings Limited (PacUn) to complete the first development phase of the Orokolo Bay Industrial Sands Project (OBP) in Papua New Guinea.
Under the binding agreement, PacUn has committed to fully fund the construction and commissioning of the magnetite phase of the OBP to achieve an initial nameplate capacity of 500,000 tonnes per annum of magnetite concentrate with markets in China, Japan and North Queensland. 1
Highlights:
- Fully Funded Development: PacUn will cover all development costs associated with but not limited to site infrastructure, processing plant construction, and initial working capital requirements, amounting to an investment of up to US$10 million to enable the magnetite phase of the OBP to be constructed and first shipments to take place.
- Upfront Payment: An upfront Commitment Fee of US$500,000 has already been paid to Mayur upon signing the Binding Term Sheet.
- Profit-sharing Regime: Agreement first allows both parties to recover their sunk capital costs during the investment recovery phase, and then will see profits being shared on a 50/50 basis
- Initial production 3Q CY25: Initial production targeted to commence in the third quarter of calendar 2025 subject to long lead orders being placed during Q1 CY2025
- PacUn takes construction and operational role: PacUn’s recognises the +10 years of investment made by Mayur that will now see the project be developed without the need for Mayur to contribute further capital. PacUn also takes on the construction and operational roles in managing the development allowing Mayur to remain focussed on its primary Central Lime and Cement Projects
About the Orokolo Bay Project
The OBP, situated within Mining Lease 541 (ML 541) and Exploration Licence 2305 (EL 2305), is a flagship project within Mayur's iron and industrial sands portfolio. The project is fully permitted and construction-ready, with initial production targeted to commence late calendar 2025.
Paul Mulder, Managing Director of Mayur Resources, said:
“Whilst Mayur has already taken a Final Investment Decision to proceed with the Orokolo Bay Project, we have been working on the most appropriate funding structure to best deliver the Orokolo Bay Project. By partnering with Pacific Unison Holdings, we have taken a pivotal step towards realising the potential of the Orokolo Bay Project being the first Industrial Sands operation in PNG. The upfront performance bond payment already received demonstrates PacUn’s genuine commitment to fully fund the project and ensure a clear and well-capitalised pathway to production under our shared vision for the project’s economic and community outcomes. Our strategic alignment with Pacific Unison Holdings also positions them as potential partners in future endeavours”
“This represents an important strategic opportunity for Papua New Guinea, for the first time, produce “Iron” - the other vital building material ingredient, in conjunction with lime/cement, to build a nation. It also preserves our balance sheet and allows us to focus our resources on bringing our Central Lime and Cement Projects into production.”
On behalf of PacUn, a spokesperson said:
“We highly recognise Mayur Resources as the parent entity and the great value created in their nation building projects around PNG that will provide essential building materials to develop the nation. We would like to take this opportunity to greatly thank Mayur Iron who have worked on this project for more than 10 years developing an excellent foundation for the project to enter construction development. We also sincerely appreciate the opportunity to work with Mayur Iron and look forward to this project being a great success for PNG”.
“This agreement reflects our confidence in the project’s potential and our shared commitment to a true nation building project that brings Iron to PNG and paves the way in future to develop PNG’s first downstream processing steel making facilities. By combining our in-country expertise and resources, we aim to deliver significant economic and social benefits to the region while advancing a world-class industrial mineral sands project that will service export markets but in future also have potential to support PNG’s local iron and steel needs. We are also eager to work with the landowners to institute post mining industry as this type of mining sees little long-term disturbance, where land rehabilitation and the ability to grow cash crops and plantations can be achieved shortly after each section is mined”.
“As we have conducted much work already on the project, we are confident in the simple low-cost sand separation operation with no crushing, grinding or chemicals to be used. We are ready to place orders with our identified suppliers and begin construction early next year. We anticipate, subject to long lead items, a construction timeframe of less than 9 months”.
Strategic Collaboration with PacUn
Pacific Unison Holdings Limited (PacUn) is a private company incorporated in Papua New Guinea with business activities that include mining of iron ore, architectural and engineering activities and quarrying of stone, and who brings expertise in mining and infrastructure development within Papua New Guinea.
Their commitment includes forming a local mining services entity to manage the construction, operation, and maintenance of the OBP.
Additionally, PacUn has been granted a first right of refusal to participate in any future industrial sands projects owned or controlled by Mayur. This ensures both parties maintain strategic alignment and the potential for further collaboration on mutually beneficial terms.
Next Steps
The signing of this binding Term Sheet Agreement represents a significant step towards unlocking the full potential of the OBP.
The parties will work collaboratively to finalise long-form agreements within the next 60 days, following the date of this announcement and upon which project construction and development will commence.
Both parties will contribute to ongoing project management for their respective obligations, ensuring alignment with strategic and financial goals.
The complete press release can be found HERE
