PERTH (miningweekly.com) – The definitive feasibility study (DFS) into the enlarged Sulphur Springs copper/zinc project, in the Pilbara, has estimated a capital requirement of A$169-million, to develop a 1.25-million-tonne-a-year operation.
Based on the base-case scenario, Sulphur Springs would produce some 65 000 t/y of 25% copper concentrate, and 75 000 t/y of 50% zinc concentrate, said ASX-listed Venturex Resources on Wednesday.
Over the 10.3-year mine life, the project would deliver 146 000 t of copper and 348 000 t of zinc.
The DFS estimated a free cash flow of A$818-million over the project life, with the pre-tax net present value estimated at A$472-million, and the internal rate of return at 51%.
“What stands out from the vast amount of work completed as part of the DFS is that Sulphur Springs is a high-quality, long-life project that will generate robust margins and strong financial returns, even using relatively conservative long-term metal price assumptions,” said Venturex MD AJ Saverimutto.
“The DFS results show a significant improvement in several key areas compared with the value engineering study completed last year, including a 40% increase in the project’s net present value, an increased reserve, increased payable copper and zinc production and a pre-tax internal rate of return of 51%.”
Saverimutto said that Venturex also managed to cut the preproduction processing plant and infrastructure capital costs estimate to A$146-million, while more accurately quantifying all capital and operating costs, refining the openpit and underground mine plan, and completing all metallurgical testwork to a very high level of accuracy.
“This is a project which is well and truly ready to go. It’s a straightforward development and mining proposition. It’s located in a tier-one mining district, close to major iron-ore and lithium operations and first-rate infrastructure. Also, the permitting process for the reconfigured openpit and underground develop is now in its final stages.”
Saverimutto said that with the DFS complete, Venturex was confident that it could move rapidly to secure an “appropriate” project finance package supported by strategic offtake arrangements that would allow the company to start development in the near term.