Name and Location
Mofe Creek iron-ore project, Liberia.

Client
Tawana Resources.

Project Description
A scoping study on the Mofe Creek project has delivered excellent technical and financial results, along with project design and development simplicity.

A scoping study has determined that the project will have an initial mine life of 14 years. It has also identified an opportunity to fast-track the initial one-million-tonne-a-year operation to a 2.5-million-tonne-a-year production scenario using existing infrastructure in 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 will be exceeded and alternative transshipment or shiploading facilities will be required.

The project development plan envisages a staged production ramp-up, starting at one-million tonnes a year (Stage 1A), increasing production to 2.5-million tonnes a year (Stage 1B).

In July, Tawana reported that it had identified four additional high-priority target areas at its Mofe Creek project, following the discovery of high-grade direct shipping ore (DSO) hematite mineralisation, averaging 62.8% iron and reaching up to 66% iron. Located a short trucking distance from the operating Port of Freeport-Monrovia, the new zone of DSO hematite mineralisation occurs in the Goehn South East prospect, within a broader 550 m strike length of friable, coarse-grained itabirite, with potential for additional strike extensions.

Itabirite mineralisation greater than 2.2 km in combined strike length, ranging in grade from 26.4% to 52.6% iron, has also been delineated, with similar geological characteristics for the 61.9-million tonnes at 33% iron maiden resource estimate.

The combination of a new DSO hematite discovery and the company’s port infrastructure memorandum of understanding with Hong Kong-based miner Wisco Cad has significantly enhanced the potential for a low capital-intensity, early start-up DSO trucking operation. The results have also strength-ened the exploration rationale for a potential Bomi Hills analogue, which historically produced more than 50-million tonnes of DSO within 35 km of the project area.

Net Present Value/Internal Rate of Return
The project has a net present value, at an 8% discounted cash flow and after royalties at 4.5%, of $435-million. The pretax internal rate of return is estimated at 55.8%.

Value
The initial capital expenditure (capex) required for first production is estimated at $52.9-million, including a 20% contingency on capex.

The total capital cost required to achieve and sustain 2.5-million tonnes a year, including an independent haul road and a transshipment facility at the coast of Liberia, is estimated at $280-million.

Duration
The timeline to initial production is 15 months from the approval of a mining licence.

Latest Developments
Liberia’s Inter-Ministerial Concessions Committee (IMCC) is still reviewing the mineral development agreement (MDA) for Tawana Resources’ Mofe Creek project, the company has reported.

The MDA, which is a legally binding agreement outlining the technical, commercial, social and environmental commitments that need to be undertaken to build, operate and sustain a project within Liberia, will last for 25 years and will incorporate the northern and southern tenements, as well as a potential early start-up project for direct shipping ore (DSO).

Tawana expects feedback from the IMCC by the end of the first quarter.

It has further reported that its definitive port infrastructure cooperation agreement with Hong Kong-based miner Wisco Cad, at the Port of Freeport, Monrovia, is also progressing.

The agreement is based on gaining access to stockpiling and shiploading services during the early stages of the project’s development and proposed DSO start-up project.

Key Contracts and Suppliers
None stated.

On Budget and on Time?
Not stated.

Contact Details for Project Information
Tawana Resources, tel +61 8 9287 4333 or fax +61 8 9389 3199.