Shares in iron ore hopeful Flinders Mines have risen after it struck a deal with four Chinese steel mills that brings its mine closer to reality.

The agreements allow the mills’ representatives to evaluate whether the iron ore at Flinders’ $1.1 billion Pilbara Iron Ore Project (PIOP) in Western Australia is suitable.

Flinders shares had jumped 9.72 per cent to 7.9 cents at 1100 AEDT.

The company said it expected to sign more memorandums of understanding and was also fielding interest from potential Taiwanese, Korean and Japanese customers.

The Hammersley Ranges project, where much of Australia’s iron ore is produced, has approval to produce up to 15 million tonnes of iron ore a year but still needs funding.

“This is a significant milestone in the development and de-risking of the PIOP, with potential customers showing strong interest in the Flinders iron ore product,” the company said.