PERTH (miningweekly.com) - Dual listed junior Elemental Minerals on Thursday reported that a prefeasibility study (PFS) into its Sintoukola potash project, in the Republic of Congo, confirmed the project’s economics.
Based on a production of around two-million tons a year of muriate of potash, the underground operation was expected to have a mine life of some 23 years. The project could be developed at a total capital cost of $1.85-billion, and would have a net present value of $2.9-billion, and an internal rate of return of 29.3%.
“The prefeasibility study confirms excellent economics and highlights the project’s key competitive advantages of a high-grade orebody suited to conventional mining and processing using proven technologies,” said Elemental’s CEO Iain Macpherson.
He noted that the scalability and location of the project also reinforced its global significance and the potential for the Congo basin to become a major potash-producing region.
“These results confirm our strategy of a fast-track approach, allowing us to remain on track to deliver an independent potash operation to the market in the near future.”
Elemental has held a number of discussions with infrastructure funds, technical partners and operators since June this year, and to date, have received several formal, nonbinding expressions of interest to build, own and operate the infrastructure components of the project. Macpherson said that the company considered these proposals to be financially and technically credible.
Elemental intended to progress negotiations to secure an agreement with a consortium to fund and operate infrastructure that was noncore to the mining operation. This would allow for a significant reduction in capital requirements of up to $580-million, he said.
With a construction duration of some three years, Elemental was targeting plant start-up by the third quarter of 2016.