PERTH (miningweekly.com) – Junior Hawsons Iron will slow the pace of its bankable feasibility study (BFS) on its namesake project, in New South Wales, to examine escalating costs and to evaluate options to progress the project.

“We, like many companies, are being challenged by the current economic climate, falling Australian dollar, supply chain cost escalations and restricted access to equity markets which are beyond our control,” chairperson Dave Woodall said.

“A project slowdown is the most sensible and prudent response to preserve capital, given global cost pressures, and will allow a focus on optimising pathways in the best interests of shareholders which are reflective of deteriorating world conditions,” he said.

Woodall said that the company’s capacity to raise additional capital during the next 12 months would be contingent on the passage of resolutions to be put to shareholders at the forthcoming annual general meeting on November 15.

“The passage of these resolutions will significantly enhance the company’s equity funding capacity and options to fund the required BFS activities,” he said.

“We absolutely believe in the value of our project as a source of high-grade magnetite concentrate and are fully committed to examining all options available to us.”

MD Bryan Granzien said on Monday that there would be a managed slowdown in all BFS activity, a thorough analysis of the capital and operating cost estimates presented to date and a strategic review of all options to progress the project, including scaling opportunities.

“This analysis and review process is going to take some time. The BFS will not be completed by the end of December 2022, but we have been left with no other choice given the current state of global capital markets and world economy,” he said.

Work on the 10-million-tonne-a-year BFS started in 2021, however, as a consequence of the increased 400-million-tonne mineral resource estimate announced last October, scope of the BFS was expanded to investigate upscaling the project’s production profile to 20-million tonnes a year, using a direct-to-port slurry pipeline.

The Hawsons Iron board later endorsed a decision to focus solely on the development of a 20-million-tonne-a-year project, owing to its expanded economics, environmental, social and governance outcomes, and its investment appeal relative to a smaller project.