Image plans 2015 start for North Perth Basin
PERTH (miningweekly.com) – Diversified minerals explorer Image Resources reported on Monday that a cost benefit analysis for an enhanced mineral processing route at its North Perth Basin (NPB) mineral sands project, had delivered improved economics.
The analysis has reduced the project’s payback period on the A$60-million to A$70-million capital costs from an initial 22 months to 16 months, and has introduced a low-cost dry mill and zircon cleaning circuit to the scope of the project, which would lift the projected internal rate of return to over 80%, and would make the operation fully independent.
The process plant costs have been estimated at between A$35-million and A$45-million, with an additional A$13-million in preproduction owner’s costs and working capital, and A$12-million in prestrip and mining related activities.
MD Peter Davies said on Monday that while maximum funding requirements were maintained, the duration of the repayment had been reduced owing to the very high ore grades mined in the early years of the project, and the resulting high front-end cash flow.
The updated economic analysis was based on the same resource, mining schedule and product price assumptions as the base case feasibility study, which predicted that the project would deliver about 180 000 t/y of product over its first two years of operation.
“The project economics are robust, even if product prices fall well below current levels, which is not expected,” said Davies.
“We believe, as we move into 2014, that the project’s unique attributes will come closer into view.”
Meanwhile, Davies noted that Image was actively progressing offtake and bank finance discussions, with a view to starting a six- to eight-month construction phase by mid-2014, with first zircon and ilmenite sales in early 2015.
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