PERTH (miningweekly.com) – Junior Red Hill Iron would launch a definitive feasibility study for its Pannawonica project, in Western Australia, after a prefeasibility study (PFS) proved positive.
The ASX-listed company announced on Monday that the PFS had concluded that Pannawonica could deliver about four-million tonnes a year of direct shipping ore, over a mine life of eight years.
The project would require a capital investment of about A$55-million, with the life-of-mine operating cash costs estimated at A$46/t free-on-board.
The PFS identified the preferred mining, processing and infrastructure requirements at Pannawonica, and has proposed that a simple direct shipping ore operation, with milling to be carried out using continuous mining equipment atop dry mesas.
First production at the project has been targeted for 2016.
Red Hill has already settled Native Title agreements over the Pannawonica tenements, and three mining licences covering the Redgate and Whitegate deposits have been granted.
Pannawonica currently has a maiden ore reserve of 29.3-million tonnes, grading 54% iron, 4.8% alumina, 0.05% phosphorus and 8.2% silica.