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Fortescue buys rest of WA's Nullagine mine

AAP logoAAP 10/10/2016

Fortescue Metals Group has acquired the remaining 75 per cent stake in the Nullagine joint venture in Western Australia from struggling junior miner BC Iron.

Fortescue said it will pay BC Iron a token sum of $1 in consideration for all the assets and royalties from future iron ore sales from the mine.

It will, however, withhold $7.5 million towards rehabilitation and other obligations of BC Iron.

"We will review operations over the coming months to determine the best path forward, taking into account all relevant factors including market demand and other potential opportunities to extract value from the assets," Fortescue chief executive Nev Power said.

Fortescue, which already owned a quarter of the Pilbara mine, stopped purchases of the mine's low grade ores in March amid a slump in prices, forcing BC Iron to suspend operations at the site.

At 1505 AEDT, BC Iron shares were up 13.5 per cent at 21 cents, while Fortescue shares were down 0.3 per cent to $4.93 each.

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