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Mineral Resources Ltd (ASX:MIN) has completed the sale of a 49% interest in the soon-to-be-finished Onslow haul road, located in Western Australia's Pilbara region, to investment funds managed by Morgan Stanley Infrastructure Partners (MSIP). The deal was valued at $1,100 million in cash.
Under the terms of the agreement, MSIP has become a partner in Mineral Resources' Onslow Iron project. In addition to the initial transaction, an additional payment of $200 million will be made by MSIP to Mineral Resources if the haul road achieves a throughput rate of 35 million tonnes per annum for any quarter before June 30, 2026.
Mineral Resources will retain majority ownership of the haul road, along with exclusive rights to its use, operation, and maintenance. Additionally, the company will maintain primary exposure to the project's steady earnings over the life of the Onslow Iron project.
The 150-kilometre Onslow Haul Road, expected to be completed by October 2024, connects the Ken’s Bore mine site to the Port of Ashburton. It was developed as part of Mineral Resources' strategy to support mining operations in the West Pilbara, particularly for stranded iron ore projects.
This development marks a significant milestone for the Onslow Iron project, reflecting the growing interest in Western Australia’s iron ore sector. Mineral Resources has positioned itself as a key player in the region, with this transaction further reinforcing its capital management strategy and collaborative approach to infrastructure development.
The managing director of Mineral Resources Ltd, Chris Ellison, highlighted the strategic importance of the partnership with MSIP. This collaboration strengthens the Onslow Iron project and underscores the company's ability to secure investments from institutional partners, thereby enhancing the financial outlook of its infrastructure assets.
