Avenira is forging ahead with its Wonarah phosphate project in the Northern Territory’s Barkly region, signing a mining agreement with the Arruwurra Aboriginal Corporation.

The project will initially export phosphate rock and is planned to later supply Avenira’s lithium-iron-phosphate battery project at Darwin’s Middle Arm Sustainable Development Precinct.

“With the potential to create over 1,000 jobs this project will benefit Territorians from the Top End to the Barkly with the manufacturing plant to be built in Darwin, which will exclusively source phosphate from the Wonarah Phosphate Project in the Barkly,” NT chief minister Natasha Fyles said.

Avenira said the mining agreement continued Arruwurra members’ support for the Wonarah phosphate project, while delivering confidence to them regarding sustainable commercial outcomes, social benefits and cultural matters.

Key commercial terms include an annual payment in respect of mineral leases of $434,750 (indexed for future payments) and a community payment of 2.5 per cent for production sold and sent to offtakers (less specified logistics costs).

Two categories of capital payments are to be made: the immediate issue of 10 million Avenira shares at a deemed issue price of $0.01 and the payment of $200,000 which will occur at the commencement of production; and a capital payment to be made every five years, being the greater of the sum of $300,000 or the equivalent to 2 per cent of any increased capital expenditure made by Avenira (after commencement of production), with that payment in any event capped at $5 million (indexed).

The company has also announced an extension of time under its MOU with Aleees and the NT Government to develop downstream manufacturing of LFP cathode material.

Avenira continues to pursue the LFP battery manufacturing project following completion of a positive scoping study, which it said demonstrated the strong economic and technical viability of the project.

Avenira and Aleees are jointly planning the development of that facility, working towards an initial 5000-10,000tpa of production (scaling to 30,000tpa in Stage 2, and 100,000tpa in Stage 3).

Avenira would construct the plant and source phosphoric acid feed from its Wonarah project, while Aleees would grant licensing rights and certain development, operational and management support.

Avenira said this agreement had been extended to September 30 this year to allow completion of the long-form licensing agreement so the parties could move ahead with next stage studies including the BFS.