PERTH (miningweekly.com) – A prefeasibility study (PFS) into the LD sulphate of potash (SOP) project, in Western Australia, has found that an annual production rate of 407 500 t could be supported over a 27-year mine life.

A total of nine-million tonnes of SOP will be delivered over the life of the project, ASX-listed Reward Minerals said on Tuesday.

The PFS estimated that a total capital investment of A$451-million will be required to fund the project, with life-of-mine all-in sustaining costs estimated at A$394/t SOP.

The project is estimated to have a pre-tax net present value of A$460-million and internal rate of return of 18%.

Reward CEO Greg Cochran told shareholders that the PFS confirmed LD’s status among Australia’s most attractive SOP projects.

“Although we have conservatively limited the project life to the shallow resource accessible by trenching, the economics are compelling. Reward has always emphasised the strategic importance of its LD project, the only tier one SOP brine resource in Australia.”

Cochran said that the size and consistently high in-situ average grade, as well as the depositional nature of the deposit, implied less resource risk, while the project’s location provided the ideal operating environment with the highest evaporation rate and low average rainfall.

He added that the LD project also had the potential to be up-scaled and turned into a very long-life operation, considering that the current PFS only considered production from the existing shallow indicated resource, leaving over 90% of the resource.

“As this phase draws to a close, Reward is now well-positioned to progress the LD project towards the financing, development and production phases. We have a fully transparent, executed and registered Indigenous Land Use Agreement in place over two-thirds of the resource, and continue to make progress on the permitting front,” Cochrane said.