Name of the Project
Watershed tungsten project.

Location
Queensland, Australia.

Client
Vital Metals.

Project Description
Vital Metals is on track to become an Australian tungsten concentrate producer after delivering a positive definitive feasibility study (DFS) on its flagship Watershed tungsten project, in Queensland, which outlines a robust 2.5-million-tonne-a-year project.

The DFS highlights the technically low-risk and economically robust nature of the project, which is expected to become one of the most significant tungsten mines in the western world.

The project has total measured, indicated and inferred mineral resources of 49.32-million tonnes at 0.14% tungsten trioxide (WO₃), or 70 400 t of contained WO₃, at a cutoff grade of 0.05% WO3. Based on the measured and indicated components of this mineral resource, the project has a maiden proven and probable ore reserve comprising 21.3-million tonnes, grading 0.15% WO3 for 31 400 t of contained WO₃ and a strip ratio of 3:1 waste to ore.

The mine will initially be developed as an openpit operation, with excavators and trucks used for mining. Based on a mining rate of 2.5-million tonnes a year, it is expected that the project will have a ten-year mine life, with excellent potential to further increase the mine life through future exploration.

Ore will be delivered to a run-of-mine stockpile before being processed through a circuit containing crushing, X-ray transmission ore sorting, rod milling, and gravity separation with spirals, ball milling and flotation.

Following optimisation studies conducted in September 2017, the average process recovery has improved from 73.6% WO₃ to 77%.

Jobs to be Created
Not stated.

Net Present Value/Internal Rate of Return
Following optimisation studies undertaken by Vital Metals the project now has a post-tax net present value (NPV) of A$150-million and an internal rate of return (IRR) of 32%, compared with a NPV of A$112-million and an IRR of 22%, as estimated in the 2014 definitive feasibility study (DFS).

Value
The initial DFS estimated that the project would require a capital injection of A$172-million to deliver a 2.5-million-tonne-a-year operation with a mine life of ten years. Vital is now estimating a capital cost of A$100-million following the optimisation studies.

Duration
Not stated.

Latest Developments
Optimisation studies at the Watershed project have boosted the project value.

Metallurgical testwork optimisation has improved tungsten recoveries from 74% to 77%, as the company focuses on optimising the feed size to the dense-media separation (DMS) plant to increase efficiencies and recoveries.

Vital metals MD Mark Strizek has told shareholders that the results from the DMS testwork have shown that simple changes to the flowsheet should improve tungsten recoveries, resulting in an uplift to the project value.

The company has also identified several opportunities to save on capital and operating costs.

Operating expenditure has been estimated at nearly 20% lower than the 2014 DFS, with life-of-mine total costs estimated at A$204/t.

The project is fully permitted.

Key Contracts and Suppliers
None stated.

On Budget and on Time?
Not stated.

Contact Details for Project Information
Vital Metals, tel +61 8 9388 7742, fax +61 8 9388 0804 or email vital@vitalmetals.com.au.