PERTH (miningweekly.com) – A cost study on the Parker Range iron-ore project, in Western Australia has lowered the capital and operating cost estimates for the project, ASX-listed Cazaly Resources announced on Tuesday.
The initial definitive feasibility study, completed in 2011, estimated a capital cost of A$169.5-million, with operating costs pegged at around A$55.29/t, based on 4.2-million-tonne-a-year operation.
However, Cazaly told shareholders that a cost estimate study for the Parker Range project had now estimated a capital requirement of A$130-million, while operating costs were expected to reach A$48.85/t.
Cazaly noted that major reductions to the expected capital cost were made with the removal of the accommodation village and the use of planned third-party camp facilities.
Further savings were also achieved by reconfiguring load-out facilities and supporting infrastructure, and in the construction of rail loops and mine-site based non-process infrastructure.
Opportunities also existed to further reduce the costs by delaying the wet plant construction by around two years, which could save a further A$20-million, and securing second-hand process plant equipment.
The savings in the operating costs were achieved largely on the back of lower mining, logistics and owner related costs, while incorporating new costs for accommodation.
Cazaly joint MD Nathan McMahon noted that the company was "greatly encouraged" by the improving iron-ore market, adding that discussions were now under way with potential end-users for the Parker Range product.