Name and Location
Mofe Creek iron-ore project, Liberia.
Client
Tawana Resources.
Project Description
A scoping study on the Mofe Creek project has delivered excellent technical and financial results, along with project design and development simplicity.
A scoping study has determined that the project will have an initial mine life of 14 years.
The study has also identified an opportunity to fast-track the initial one-million-tonne-a-year operation to a 2.5-million-tonne-a-year production scenario using existing infrastructure in Liberia, including a sealed road from the Gofolo mine to the Port of Monrovia, and an existing deep-water port at Freeport-Monrovia. As the project expands, the Freeport capacity will be exceeded and alternative transshipment or shiploading facilities will be required.
The project development plan envisages a staged production ramp-up, starting at one-million tonnes a year (Stage 1A) and then increasing production to 2.5-million tonnes a year (Stage 1B).
Net Present Value/Internal Rate of Return
The project has a net present value, at an 8% discounted cash flow and after royalties at 4.5%, of $435-million. The pretax internal rate of return is estimated at 55.8%.
Value
The initial capital expenditure (capex) required for first production is estimated at $52.9-million, including a 20% contingency on capex.
The total capital cost required to achieve and sustain 2.5-million tonnes a year, including an independent haul road and a transshipment facility at the coast of Liberia, is estimated at $280-million.
Duration
The timeline to initial production is 15 months from the approval of a mining licence.
Latest Developments
Tawana has reported that the agreement to formalise the legal and commercial conditions of the Mofe Creek project for the next 25 years is months away from finalisation.
The iron-ore miner has presented its Mineral Development Agreement (MDA) to the Liberian Interministerial Concessions Committee (IMCC) in what is deemed a critical step before the preparation of a final draft report for presidential signature and its subsequent passing into a Bill for parliamentary ratification.
The MDA is a legally binding agreement, outlining the technical, financial, commercial, socioeconomic, labour and environmental commitments to be undertaken to build, operate and sustain a project in Liberia.
The IMCC is responsible for coordinating and overseeing the investment concessional review process and due diligence functions.
All natural resource concession agreements in Liberia, including mining concessions, are negotiated by the IMCC.
Key Contracts and Suppliers
None stated.
On Budget and on Time?
Not stated.
Contact Details for Project Information
Tawana Resources, tel +61 8 9287 4333 or fax +61 8 9389 3199.