Photo by: Bloomberg
PERTH (miningweekly.com) – Graphite producer Valence Industries on Tuesday revealed that a recent increase in the ore reserve at the Uley project, in South Australia, had increased the expanded project’s net present value by 38%, from A$65-million to A$90-million.
In January this year, Valence completed a feasibility study into Phase 2 of its Uley graphite project, which would require a capital investment of about A$37-million, over a three-year period, to increase production from the current Phase 1 level of 14 000 t/y to 50 000 t/y.
Valence said on Tuesday that following an upgrade to the project reserves in May this year, the internal rate of return had also increased from the 46% reported in January to 47%.
Valence in May announced a 43% increase in the graphite ore reserve at the Uley project, with a 60% increase in the expected mine life, to eight years, at an output of 64 000 t/y.
Some 2.9-million tonnes, at an average head grade of 12.1%, would be mined during the life of the project.
“This significant and highly positive revision to the feasibility study of the Uley graphite project highlights its compelling commercial viability,” said Valence MD and CEO Christopher Darby.
“Furthermore, the project’s significant uplift in net present value to A$90-million suggests significant value upside in the company as this equates to more than double Valence’s current market capitalisation.”