PERTH (miningweekly.com) – Rare earths developer Arafura Resources is hoping for production from its Nolans project, in the Northern Territory, to start in 2019.
In releasing the project's development report to shareholders, ahead of the start of the definitive feasibility study (DFS), Arafura pointed out that the project retained its robust economics.
Despite a A$1-billion cost cut to the project’s development budget, the Nolans project had a net present value (NPV) of A$2.045-billion and an internal rate of return (IRR) of 21.4%. This was compared with the 2012 NPV estimate of A$4.3-billion and a 30% IRR.
“Our development report draws attention to the commercial appeal of the Nolans project and is testimony to the tremendous efforts of the Arafura team and our partners to de-risk the project’s path to production,” said Arafura MD Gavin Lockyer.
The development report would be used as a launch pad for the DFS, which was targeted for completion by mid- to late 2015.
The DFS would be progressed alongside other key activities which would enhance funding opportunities, and would include the confirmation of provisional product sales agreements, advancing regulatory permitting for the project site, and securing an offshore site for the rare earth separation plant.
“Nolans remains on track to become a significant supplier of rare earths when it comes on line in the latter part of this decade. Importantly, the project’s production commencement coincides with the projected supply shortage of magnet-feed and other critical rare earths in which Nolans is particularly well endowed,” said Lockyer.