Name of the Project
Ngualla rare earth project.
Location
On the Ngualla carbonatite, southern Tanzania.
Project Owner/s
Peak Rare Earths.
Project Description
Ngualla is one of the biggest and highest-grade undeveloped neodymium/praseodymium oxide projects in the world.
The updated bankable feasibility study (BFS), completed in October 2022, estimates ore reserves at 18.5-million tonnes grading 4.8% total rare-earth oxides (TREOs) for contained TREOs of 887000 t.
Rare-earth ore mined from the Ngualla deposit will be processed through a concentration plant, which is co-located at the mine site. Ore will be beneficiated through a milling and two-stage flotation circuit, resulting in a high-grade rare-earth concentrate of about 45% TREOs.
Based on the original BFS, completed in 2017, the updated BFS has decreased the concentrate production from Ngualla from 18 200 t/y of TREO to 16 200 t/y over a 24-year mine life.
Net Present Value/Internal Rate of Return
The BFS update estimates a net present value, at a (real) 8% discount rate, of $1.48-billion and an equity internal rate of return of 37.3%.
Potential Job Creation
Not stated.
Capital Expenditure
Preproduction capital has decreased from $356-million in the 2017 BFS to $321-million in the updated BFS.
Planned Start/End Date
With the completion of the BFS update, Peak’s focus will now shift to progressing the Ngualla project towards a final investment decision by the end of May 2023.
Latest Developments
Peak Rare Earths has been granted a special mining licence for its Ngualla rare earths project.
The grant of the special mining licence follows the signing of a binding framework agreement with the government of Tanzania in April, and will initially cover a 30-year term over an 18.14 km2 area that contains the Ngualla project deposit.
In accordance with the framework agreement, the special mining licence area will be expanded in the future to include an existing prospecting licence and a recently expired prospecting licence, while the initial term of the licence will also be amended, with the ability to extend on application in accordance with the law at the time.
Meanwhile, Peak has reported that it will raise A$27.5-million in a two-tranche institutional placement to advance the Ngualla project towards a final investment decision by the end of September.
Peak has said that it has received firm commitments from institutional investors for the placement, under which about 55-million new shares will be offered at 50c each.
The first tranche of the placement will comprise about 28.6-million shares, raising A$14.3-million under Peak’s existing placement capacity, while the second tranche of 26.4-million shares, to raise a further A$13.2-million, will be subject to shareholder approval.
The offer price represents a 20% discount to Peak’s last closing price on April 26, and a 25.3% discount to the company’s five-day volume weighted average share price.
Peak’s biggest shareholder, Shenghe Resources, has committed to top up its shareholding to 19.9% through the placement, subject to shareholder approval.
Key Contracts, Suppliers and Consultants
Wood (project management and BFS update lead); Oreology Mine Consulting (ore reserve update and mine planning); Knight Piésold Consulting (tailings management and water hydrology); Dhamana Consulting (environmental management); Future Proof (environment, social and governance strategy and reporting); Paulsam Geo-Engineering Company (environmental- and social-impact assessment); Ai (market analysis and pricing outlook; WaterBorne Capital (financial modelling and analysis); and Auralia Metallurgy (metallurgical testing).
Contact Details for Project Information
Peak Rare Earths, tel +61 8 9200 5360 or email info@peakrareearths.com.