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Australia’s A$146m iron ore mine approved

26th July 2013

By: Natalie Greve

Creamer Media Contributing Editor Online

  

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Construction of a new A$146-million iron-ore mine, near Port Hedland, in Western Australia, has been approved by the board of mining company Atlas Iron, following the conclusion of an agreement with fellow ASX-listed joint venture (JV) partner, Altura Mining.

The company aims to start mining oper-ations in December 2013, with exports set for mid-2014.

Mt Webber, which will be Atlas Iron’s fifth mine, will target an initial production rate of three-million tons a year of iron-ore, which will form part of Atlas’s overall North Pilbara standard product blend.

At this production rate, the mine is said to have an initial mine life of 18 years.
Mt Webber ore is expected to be trucked to Utah Point, at Port Hedland, as part of the first-phase development, with first ore shipments expected in June 2014.

The company says it will later target an increased production rate of six-million tons a year of iron-ore in a Phase 2 development at the project.

Atlas MD Ken Brinsden states that the decision to develop Mt Webber represents another key milestone for the company, as it is the largest of its Horizon 1 mines and will provide Atlas with high-quality, long-life production.

This will enable the iron-ore producer to reach its targeted 12-million-ton-a-year production rate by the June quarter of 2014.

“With our Pardoo, Wodgina and Mt Dove mines in operation, Abydos due to start in the current quarter and Mt Webber in development, Atlas will have delivered five mines in around five years. “This positions the company to deliver strong cash flows, which will, in turn, underpin returns to shareholders and enable Atlas to consider further investment in its pipeline of quality growth projects,” he comments.

Other Operations

The Pardoo project, which was Atlas’s first producing iron-ore mine, is located about 75 km east of Port Hedland. The mine started its operations in October 2008 and produces a quality low-alumina direct shipping ore (DSO) product from a number of openpits. Ore is mined by a conventional truck-and-backhoe mining fleet, before being crushed and screened on site and delivered to port by covered road trains.

Atlas has defined 14 separate DSO resources and one channel iron deposit resource at Pardoo, as well as the Ridley magnetite project. Excised from within the project are the Ord and Ridley iron-ore deposits, which are held by mining giant BHP Billiton.

The Wodgina DSO project, located about 100 km south of Port Hedland, on the Great Northern Highway, was commissioned in July 2010. Atlas acquired 100% of the iron-ore rights to the project area from Talison Minerals, now Global Advanced Metals (GAM), in February 2008 and became the main focus of Atlas’s exploration efforts. The operation also forms an integral part of Atlas’s expansion plans.

Atlas’ DSO deposits and exploration prospects at Wodgina are located within the Wodgina greenstone belt, centred on Talison’s Wodgina tantalum mine – the world’s largest single tantalum resource.

The decision to fast-track Wodgina was facilitated by the agreement between Atlas and GAM, granting the company access to the unused tantalum mine infrastructure following GAM’s Talison’s decision to place the operation into care and maintenance.

This agreement, announced in February 2009, provided access to a crushing and screening plant capable of processing up to six-million tonnes of iron-ore a year, as well as a 10 MW gas-fired power plant, a high-quality 300-person accommodation camp and associated mine administration facilities.

“Having this infrastructure in place, in such close proximity to the newly discovered DSO resources, saved Atlas tens of millions of dollars in capital expenditure at the outset. We are currently in the process of expanding its operations at Wodgina to a targeted 5.5-million tonnes a year through the facilitation of a new crushing and screening facility for GAM,” the company states.

The Wodgina mine produces a good-quality low-alumina fines-only product, which is trucked to the nearby multi-user Utah Point port at Port Hedland for export.

Wodgina remains a highly prospective exploration target for Atlas. In addition, Atlas is exploring applying beneficiation opportunities at Wodgina. “We are confident that these initiatives have an excellent likelihood of increasing the current resource portfolio,” the company reports.

Atlas’s Mt Dove mine, the company’s third producing DSO mine, forms part of the Horizon 1 growth programme.

Edited by Megan van Wyngaardt
Creamer Media Contributing Editor Online

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