Spanish potash developer Highfield Resources (ASX:HFR) has signed a Memorandum of Understanding (NASDAQ:MOU) with the Port Authority of Bilbao providing a second option for shipment of product to export markets from its Muga Potash Project.
Highfield's shares have been a strong market performer, up 34% since December and risen by 100% since April 2004.
A Pre-feasibility study has been completed for the Muga Project and completion of a Definitive Feasibility Study is due by the end of the March quarter 2015.
This MOU follows a similar agreement struck with the Port of Pasajés (San Sebastián), announced 18 December 2014.
The MOU provides for shipments up to and beyond 400,000 tonnes per annum.
As significantly, it locks in 25,000m2 of wharf space including 200 linear metres of dedicated mooring for the construction of Highfield's handling facilities and can handle vessels of up to 32 metres draught.
Highfield at Spain's fourth largest port by total tonnage handled in 2013.
The Port of Bilbao is located 220 kilometres by road from the site of the Muga Project and is one of the main hub ports of the European Atlantic seaboard.
Together the Port MOU's will enable Highfield to ship 100% of future potash product from Muga.
As Highfield Resources' managing director Anthony Hall, said:
"We are extremely fortunate to have two large commercial ports within easy reach of the Muga Project's future production facilities. Our agreement with the Port of Bilbao is an important element of developing the mine's logistics solution with a long-term view, flexibility and increased optionality from the onset.
"The Port of Bilbao is a major LNG terminal and a hub for maritime traffic. It is well prepared for and well connected to service north and south Atlantic trade; both of which we expect to work with as our operations build scale.
"Coupled with the MOU signed last month with the Port of Pasajés, we are now in an excellent position to assess routes to export markets."
Port of Bilbao background
The Port of Bilbao is one of the main hub ports of the European Atlantic seaboard and covers 350 hectares of land, 17 kilometres of dock, has 252 hectares of open storage, 30,000m2 of covered storage, 25,300m2 of cold storage and terminals for containers, solid and liquid bulks, forest products, vehicles, general cargo, and passengers.
With a history of 700 years of trade and commerce, it operates commercial services for all types of markets.
The two MOU's with major Ports in Spain lock in shipping options for the Muga potash projectand serve to de-risk project development further as gaining Port capacity is essential ahead of mining and production timetables.
As noted, shares in Highfield have out-performed the smaller companies indices providing a stellar return for investors.
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