Fortescue Metals Group ("ASX:FMG") ("Fortescue") has signed a Memorandum of Understanding with Iron Ore Holdings ("ASX:IOH") that creates the opportunity to include IOH's Iron Valley in an expanded Nyidinghu development and mining program.
Iron Valley is contiguous to Fortescue's Nyidinghu deposit and the iron ore resource at Nyidinghu extends into Iron Valley.
Fortescue Chief Executive Officer Nev Power said with more than 2 billion tonnes of iron ore Resource already identified at Nyidinghu, the project is large scale and a core focus in Fortescue's plans to expand production beyond 155 million tonnes per annum.
Following the normal approval processes Fortescue is committed to expediting the project.
"Iron Valley's location as a contiguous ore body to Nyidinghu would provide Fortescue with infrastructure layout and mining operations flexibility," Mr Power said.
Mr Power said the transaction with IOH provided another example of Fortescue teaming with a junior iron ore company in the Pilbara, to transform and develop their project and company.
The MOU is subject to completion of all legal documentation.