Name of the Project
Urquhart bauxite project.

Location
The project is located on Queensland’s Cape York, in Australia.

Client
Cape York HMS & Bauxite Project Joint Venture (JV), which comprises Oresome Australia, a wholly owned subsidiary of Metallica, and Ozore Resources.

Project Description
An independent prefeasibility study (PFS) has supported the development of the project.

The project consists of two bauxite plateaus – Area A and Area B – both of which are wholly contained within mining licence 100044.

The project has a targeted production rate of 1.5-million tonnes a year, producing 6 532 t/y of saleable product over a 5.5-year mine life.

The proposed mining operations are very simple, with the deposit being mined in 160-m-wide strips, which will start in the lower strip ratio and higher-grade material in Area A. Strips will be mined contiguously to allow for short hauls to the nearby mined-out strip for dumping overburden (predominantly sand cover) back in-pit, resulting in the continuous rehabilitating of mined-out areas. The target bauxite horizon ranges in thickness from 0.5 m to 4 m and averages 1.5 m. Overburden thickness varies and is thinnest in the eastern part of Area A, which is scheduled for initial production. In scenarios 1 and 2, there will be no screening of bauxite material. Scenario 3 allows for stockpiling of transitional material.

Potential Job Creation
The JV will have minimal staff on site to manage contractors and the shipping of direct shipping bauxite to clients.

Net Present Value/Internal Rate of Return
The updated PFS estimates a pretax net present value, at a 10% discount rate, of A$47.3-million, on sales of 6.5-million tonnes of Urquhart’s proven and probable reserves. The project has a post-tax internal rate of return of 364%. Payback is estimated at 2.2 years.

Value
The updated PFS has confirmed start-up capital at A$2.2-million.

Duration
The highest-margin bauxite in Area A is slated for first production in 2019.

Latest Developments
Metallica has said that it will finalise negotiations for a binding agreement over granting access to build a haul road connecting Urquhart to the barge facilities at Hey Point.

The company has escalated the current haul road impasse to the highest level of the Queensland government, and officials are negotiating with all parties directly.

Key Contracts and Suppliers
IMC Mining (updated prefeasibility study) and LCR Group (mining and haulage operations at Urquhart).

On Budget and on Time?
Too early to state.

Contact Details for Project Information
Metallica Minerals, tel +61 7 3249 3000, fax +61 7 3249 3001 or email admin@metallicaminerals.com.au.