PERTH (miningweekly.com) – ASX-listed Arcadia Minerals has moved to allay shareholder concerns that the Namibian government’s ban on the export of unprocessed ore of certain critical minerals, including lithium, cobalt, manganese, graphite and rare earths, will affect its Swanson tantalum mine.
The company on Thursday said that it had "no intention" of exporting unprocessed crush ore, and had no intention of doing so in future.
Instead, under an agreement with Hebei Construction signed in May this year, Hebei would construct a multi-gravity separation plant at its own cost and execute mine development at Swanson up to a steady-state production for three months, in return for a 38% interest in the project.
The gravity plant is being constructed to produce a tantalum concentrate.
Furthermore, tantalum is not considered a critical mineral in Namibia.
Hebei has now started with the construction of the road between the Swanson mine site and the proposed plant.
“We are very pleased with the progress Hebei is making at advancing the Swanson tantalum/lithium project towards production. Since inking our deal with Hebei, construction has already commenced and work is accelerating both on site and around equipment receipt/ordering,” said Arcadia chairperson Jurie Wessels.
“At site, roads are already being constructed and earthworks around the plant location will commence shortly. Equipment, such as the jaw crusher, cone crusher, feeder, screen and conveyors, has been ordered or is en route. Long lead items ,such as the drilling machine, ball mill and crushers, have also been ordered. The balance of equipment, particularly the gravity plant equipment, is expected to be finalised before the end of July.
“This is a very exciting time for the company as we aim to execute part of our strategy to develop the Swanson project into a potential cash generator. Based on results from our recent definitive feasibility study, the expected attributable free cash flow of circa A$4-million Arcadia stands to receive per year could provide non-dilutive capital to aggressively advance the company’s highly prospective and potentially transformational exploration assets.”
The study estimated a capital cost of A$14.8-million to support a run-of-mine production rate of 12 500 t a month over an eight-year mine life. The study estimated a post-tax net present value of A$15.36-million, an internal rate of return of 25.4%, a pay-back period of just over three years, and life-of-mine earnings before interest, taxes, depreciation and amortisation of A$48.35-million.