PERTH (miningweekly.com) – Iron-ore hopeful Tawana Resources has revealed that its Mofe Creek project, in Liberia, could deliver about 2.5-million tonnes a year of iron-ore.

A scoping study has found that the project would have an initial mine life of 14 years, and would deliver a revenue of around $2.5-billion. Mofe Creek’s net present value has been estimated at $435-million and the project was expected to have a pre-tax internal rate of return of 55.8%.

The project development plan envisaged a staged production ramp-up, starting at 1-million tonnes a year and increasing to 2.5-million tonnes a year. An initial capital investment of $52.9-million would be required for the Stage 1 investment, with total project capital cost estimated at $280-million, over four years of production.

“This study validates the opinion of the executive management team that Mofe Creek ticks all the boxes, with low capital expenditure, low operating costs, significant operating margins, a premium 65% iron product and a lifespan of at least 14 years,” said Tawana chairperson Wayne Richards.

Operating costs have been estimated at an average of $40.60/t for the life of the project.

Richards added that the scoping study had positioned Mofe Creek as a potential bottom quartile operating cost producer, with long-term logistics solutions designed to be implemented sequentially, from forecast cash flows or strategic funding.

The scoping study identified an opportunity to fast-track the initial 1-million-tonne-a-year to 2.5-million-tonne-a-year production scenario by using existing infrastructure within Liberia, including a sealed road from the Gofolo mine to the Port of Monrovia, and an existing deep-water port at Freeport-Monrovia.

As the project expands, the Freeport capacity would be exceeded and alternate transshipment or ship-loading facilities would be required.

Richards said on Thursday that the company would use the scoping study to further advance discussions with potential strategic partners, offtake partners and with debt providers and financiers in order to fast-track development.

Tawana would also start a prefeasibility study on Mofe Creek immediately.