Timeone agreed to commercial terms with leading Shanghai-based mining, logistics and commodities trading company SS&T Group to provide it with the funds and in doing so, the latter will become a controlling shareholder in Timeone.

It follows an amendment to a previous subscription agreement between the two parties struck in September last year.

Of the funds provided, $17.66 million will be used to complete Timeone’s share subscription in Pluton and a further $52.34 million will be paid for it to earn a 50% interest in the proposed JV.

The funding will enable the Chinese investor to complete the purchase of tranche 4C shares at 35.5c per share and fund Pluton for the acquisition of the Cockatoo Island project and the initial development of stage 4 mining.

In essence, Pluton will be free-carried for the Cockatoo Island acquisition and partially carried for the development of stage 4 mining.

Of the $70 million funding package, Pluton has already received $5 million from the issue of tranches of 4A and 4B at 35.5c a share.

Pluton shareholder approval for the share issue and sale of 50% of Cockatoo Island will be sought at an extraordinary meeting on June 29.

It expects the Cockatoo Island acquisition will be finalised prior to the meeting.

Pluton has already bedded down an offtake deal with Timeone for iron ore pre-concentrate from its proposed flagship Irvine Island project in WA and is working towards completing a definitive feasibility study before a final investment decision and first production by late 2013 or early 2014.

Timeone will manage the barging of pre-concentrate material to a trans-shipment facility located adjacent to Irvine Island from where it will be shipped to the Rizhao port in China, where Timeone is building a beneficiation plant which will produce a 67.5% premium iron ore concentrate.

Under the deal, the Chinese group will also undertake all marketing of the Irvine Island product for a fee of 2.5% of revenue.

A prefeasibility study on the project released in June last year assessed an initial $710 million development based on indicated resources at the southern end of the Hardstaff Peninsula and found it could deliver 40 million tonnes of saleable concentrate over an 11-year mine life, generating revenue of around $5.6 billion and an internal rate of return of 38%.

It was based on the Australian dollar exchange rate of US82c and a free-on-board iron ore fines prices of $69 per dry metric tonne.

Resulting pre-concentrate produced would carry an average grade of around 40% iron and cash operating costs were expected to be $A63/t of final concentrate, or $74/t including royalties.

Shares in Pluton Resources were up 2.38% or 0.5c in morning trade to 21.5c.