St. George Signs MOU with SKI HongKong for Araxa Niobium Project | INN

St. George announced its acquisition of Araxa in August, and is currently completing the final steps to close the purchase.

St. George Mining (ASX:SGQ) said on Monday (October 21) that it has entered into a non-binding memorandum of understanding (MOU) with global steel materials trading house SKI HongKong for a potential strategic partnership to advance the Araxa niobium-rare earths project, located in Brazil.

“The MoU establishes a general framework for collaboration on marketing, offtake and financing aspects of the project with the aim of progressing feasibility studies for a mine development,” the company said.

St. George announced plans to acquire Araxa in August, and shareholders voted in favor of the deal on October 8. Currently the company is working on the final steps required to complete the transaction.

The Araxa acquisition comes by way of the purchase of a subsidiary of Itafos (TSXV:IFOS,OTC Pink:MBCF).

Under Monday's agreement, St. George and SKI HongKong will consider and negotiate a potential binding partnership to further support the development of the project within nine months of signing the MOU. Key project development parameters such as product mix and global marketing arrangements will be discussed during this time.

“SKI is an impressive strategic partner for St George, based on its substantial trading track record in steel materials and its particular industry-leading expertise in niobium products,” said John Prineas, executive chairman of St. George.

The companies will also discuss offtake arrangements, with SKI HongKong potentially securing 20 percent of niobium products produced by Araxa. Currently, the compay exclusively sources niobium products from Canada's Niobec mine.

SKI HongKong may also provide funding for St. George via an investment or offtake prepayment.

Araxa is adjacent to CBMM's flagship niobium mine, which produces 80 percent of the world's niobium.

High-grade rare earths and phosphate mineralisation has been confirmed at the project via drilling.

St. George is planning to produce sample niobium products in the first quarter of 2025 using the Araxa pilot plant, depending on specifications to be agreed with SKI HongKong and the results of product testing by SKI HongKong.

The first stage of on-the-ground exploration work is set to commence before the end of this year. St. George has assembled a highly experienced team in Brazil to oversee the process.

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Securities Disclosure: I, Gabrielle de la Cruz, hold no direct investment interest in any company mentioned in this article.