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PERTH (miningweekly.com) – A prefeasibility study (PFS) for multi-metal developer Elementos’ Cleveland tin mine, in Tasmania, has estimated that a capital investment of A$23.9-million would be required to fund the first stage of the project.
The PFS investigated the staged development of the project, with Stage 1 including a tailings retreatment plant, while Stage 2 included an underground operation.
Stage 1 would require a capital investment of A$23.9-million, and would produce about 1 000 t/y of tin and 300 t/y of copper in concentrates from a 650 000 t/y mill. The Stage 1 development would have a net present value (NPV) of A$30.9-million and an internal rate of return (IRR) of 56%.
The tailings treatment project would have a mine life of six years.
The Stage 2 underground operation would require a further A$43.8-million investment, and would deliver about 1 900 t/y of tin and 700 t/y of copper in concentrates, with the mine delivering around 360 000 t/y of ore.
The Stage 2 operation would have an estimated mine life of ten years, and could deliver a NPV of A$40.4-million and an IRR of 30%.
Elementos MD Calvin Treacy said that there was the potential to expand the base case mine capacity to 500 000 t/y by defining a larger project resource inventory, which could significantly improve the underground project economics by lowering the unit operating costs for only an incremental increase in capital expenditure.
He added that the phased development strategy at Cleveland, in combination with project finance at each stage, would significantly reduce the future equity capital requirements of the project.
A bankable feasibility study for the tailings retreatment would be completed this year, and construction was expected to start in 2015, with first production expected in 2016.
The underground mine would be phased into production during 2018, in parallel with the ongoing tailings retreatment project.
Free cash flows from the tailings retreatment operation would be used to fund underground resource conversion, with the aim of expanding the production rate of the Stage 2 underground operation.