The emerging phosphate company, which entered a trading halt yesterday pending the release of the deal, has signed a non-binding memorandum of understanding with NMDC under which NMDC management staff will join the Minemakers team to undertake a joint feasibility study on the project.

The study is expected to be completed in the early fourth quarter this year, after which Minemakers and NMDC will enter a joint venture agreement for bankable feasibility, financing and development of Wonarah as well as downstream fertiliser manufacturing facilities.

NMDC will receive a 50% stake in Wonarah in exchange for arranging debt finance for the development of the project.

NMDC will also pay Minemakers for costs already incurred on the project.

The proposed development will include a mine and downstream processing facilities to produce beneficiated rock phosphate for export as well as phosphoric acid and fertiliser products including diammonium phosphate and monoammonium phosphate.

Minemakers’ managing director Andrew Drummond said the company was pleased it now had financial backing to develop Wonarah.

“Wonarah is Australia’s largest known phosphate deposit and a partner of the scale of NMDC brings the financial and marketing capacity to allow the project to be developed to its full potential,” he said.

The news of the deal comes as no surprise. Last month, the Indiaexpress.com website reported that NMDC was likely to sign a MoU with the company.

“Minemakers confirms that it has had confidential discussions with representatives of NMDC about the development of the Wonarah project and has furnished information for the purposes of these discussions,” Minemakers said at the time.

“Those discussions are continuing.”

Late last month, Minemakers announced it had terminated an agreement with Verte Group regarding engineering, procurement and construction (EPC) funding in the Wonarah project.

The company said at the time that the termination of the deal freed it up to pursue alternative funding and development options for the deposit.

Wonarah has an indicated and inferred resource of 1.26 billion tonnes at 12% phosphate at a 0% cut-off and a 630Mt at 18% phosphate resource at a 10% cut-off.

Shares in Minemakers were last trading at 54c.