Study confirms WA project’s technical, financial viability
PERTH (miningweekly.com) - A scoping study into ASX-listed explorer Potash West’s Dandaragan Trough project, in Western Australia, has confirmed the technical and financial viability of the project.
The scoping study considered two production rates, including a four-million-ton-a-year, and a 2.4-million-ton-a-year operation, which was identified to be the more suitable option to the immediate market demand.
“This is a significant study for Potash West and its shareholders. The study brings together many months of work, carried out by our partners and external consultants, all highly qualified in their field,” said MD Patrick McManus on Thursday.
He noted that the study showed that the Dandaragan Trough project had the capacity to be a technically and financially viable project, with strong operating margins, and had the potential to be expanded significantly, as markets were developed.
“The project benefits from its location in Western Australia, with high-quality infrastructure and a ready market for fertiliser products,” McManus added.
The scoping study was based on the Joint Ore Reserves Committee-compliant resource outlined at the Dinner Hill deposit, which was only a part of the greater Dandaragan Trough project.
The Dinner Hill deposit currently hosts a total resource of 244-million tons, grading 3% potassium oxide and 1.6% phosphorus pentoxide.
Capital costs for the 2.4-million-ton-a-year operation have been estimated at A$650-million, while capital costs for the four-million-ton-a-year operation were estimated at A$882.9-million.
The net present value (NPV) for the 2.4-million-ton-a-year operation were estimated at A$808-million, while the four-million-ton-a-year operation had a NPV of A$1.16-billion.
Potash West was also evaluating capital and cost improvements, which were documented during the scoping study process, and would form part of ongoing investigations.
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