–PERTH (miningweekly.com) – ASX- and TSX-listed Magma Metals on Monday reported that a scoping study into the Thunder Bay North platinum/palladium/copper/nickel project, in Ontario, had found that the project could deliver a cash flow of between C$164-million and C$360-million.

“The result of the scoping study clearly indicates that we have the basis for a robust project,” said Magma chairperson Keith Watkins.

“There is also considerable upside potential to enhance the economics of the project, particularly by increasing the mineral resource available for mining, or reducing the capital and operating costs for mineral processing,” he added.

In the base-case scenario, the project would generate an undiscounted pretax cash flow of C$164-million, with an initial rate of return of 13%. Under the upside case, the project could generate as much as C$360-million, with an internal rate of return of 27%.

Watkins noted that the scoping study favoured an openpit mine option in the Current Lake and Bridge Zone areas, from which around ten-million tons of material, at an average grade of 1,9 g/t platinum equivalent, could be extracted.

The pit would be mined at a rate of 1,5-million tons of resource a year, over a seven-year mine life.

Watkins said in a statement that the project would require the completion of both federal and provincial environmental assessments and permitting processes, and a strategy and timeline for these requirements have now been completed.

It was anticipated that the formal assessment and permitting process could take up to two years to complete, and that the earliest start-up for a mining project would be in the first half of 2014.

Magma would also now focus its attention on further technical studies on the project, to develop a minerasl processing solution to reduce the operating and capital costs of the project, and to enhance the metal products.

Alternative processing strategies would also be considered.

 

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