DFS completed at Lake Wells
PERTH (miningweekly.com) – The Lake Wells sulphate of potash (SoP) project, in Western Australia, could deliver free cash flows of A$3.1-billion over its 30-year mine life, a definitive feasibility study (DFS) has found.
ASX-listed Australian Potash on Wednesday reported that at a capital cost of A$208-million, the Lake Wells project could deliver 150 000 t/y of SoP, based on the maiden reserve of 3.6-million tonnes.
The DFS estimated a pre-tax net present value of A$665-million and an internal rate of return of 25%, while life-of-mine cash costs have been estimated at $262/t.
Australian Potash MD and CEO Matt Shackelton said that the project had proven to be extremely competitive in terms of capital intensity, forecast first quartile operating costs and exceptional returns.
“The completion of the DFS enhances our ability to finalise binding offtake agreements, optimise and secure the finance debt package, finalise the approvals process and commence front-end engineering design activities,” he said.
“Our premium high grade SoP project will be a hallmark operation in commencing a new export industry for the Eastern Goldfields region of Western Australia. We also plan to reserve a significant portion of output for the Australian market,” said Shackelton.
Lake Wells would be developed over a 24-month period from a final investment decision.
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