PERTH (miningweekly.com) – The Boonanarring/Atlas mineral sands project, in Western Australia, will require a capital investment of about A$52-million to develop, ASX-listed Image Resources reported on Tuesday.
A bankable feasibility study (BFS) estimated that the Boonanarring deposit would deliver some 1.1-million tonnes of heavy mineral concentrate while the Atlas deposit would deliver an additional 711 000 t.
The Boonanarring deposit is estimated to have an initial mine life of five years, after which mining would move to the Atlas deposit, which would add a further three years to the overall mine life. However, Image said on Tuesday that there was opportunity to extend the mine life from a confirmed extension area of high-grade mineralisation to the north of Boonanarring that was within economic pumping distance of the planned location of the wet concentrator plant.
Image told shareholders that the company had secured an offtake agreement for 100% of the heavy mineral concentrate to be produced over the life of the project, with pricing to be based on then-current relevant market prices.
At current prices, the combined project is estimated to generate revenues of about A$793-million, with the BFS estimating a pre-tax net present value of A$135-million and an internal rate of return of 64%.
Image is hoping to secure project funding by the third quarter of this year, allowing construction to start, followed by commissioning and first production in the first quarter of 2018.
In the meantime, the company will continue to review the capital and operating costs of the Boonanarring/Atlas project, to determine the possibility of reducing overall costs.