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IMX Resources: Hedging Positions For Cairn Hill Iron Ore Closed Out

IMX Resources (ASX: IXR) has closed out its remaining iron ore hedging positions, which were entered into in November 2010.

As a result of this decision, IMX Resources has terminated hedging facility with Credit Suisse, which covered 30,000 tonnes of Cairn Hill iron ore production per quarter on a WA FOB basis at a price of $124 per tonne.

Cairn Hill is operated by Termite Resources, which is owned by Outback Iron, a joint venture between IMX (51%) and Taifeng Yuangchuang International Development Co (49%).

Highlighting how IMX Resources continues to move Cairn Hill forward, earlier in the year the company announced that it had intersected visible magnetite quartz and magnetite gneiss mineralisation 25 kilometres southeast of the project, in South Australia.

All six holes of a reverse circulation drilling program at the Tomohawk target intersected visible wide intervals of mineralisation.

Tomohawk was identified from a 2011 airborne geophysical survey, and is the strongest magnetic anomaly in the area south of Cairn Hill.

Cairn Hill - phase one

Phase one of the Cairn Hill project is a unique magnetite iron-copper-gold direct shipping ore operation, producing a premium coarse grained magnetite product with a clean saleable copper-gold concentrate.

IMX has also announced a Phase two resource, which the joint venture project group is accelerating to begin production of a saleable iron intermediate concentrate of about 60%.

While the softening of iron ore and copper prices in recent months has seen the pricing of Cairn Hill magnetite copper ore under the Phase one Life of Mine sales contract reduce by 25%, operations at the mine site are performing at designed capacity with cash operating costs free on board trending towards the target of A$75 per tonne with opportunities for further improvement already identified.

Importantly, Cairn Hill is located close to the Darwin to Adelaide railway, 55 kilometres southeast of Coober Pedy.