PERTH (miningweekly.com) – The significant depreciation of the Australian dollar value and the subsequent lower costs of Australian products and services would result in economic benefits to ASX-listed Vital Metals’ proposed Watershed tungsten project, in Queensland.
Vital on Thursday reported that a review of its 2014 definitive feasibility study (DFS) had resulted in a decrease in expected capital expenditure, from A$172-million to between A$138-million and A$129-million, depending on the exchange rate.
A 15% reduction in operating costs has also been applied over the previous DFS assumptions of A$56-million a year, after vendors provided updates on previous estimates.
“The combined effect of changes to exchange rate and operating cost base means that Watershed is now an even more compelling proposition,” Vital MD Mark Strizek said.
“The project is well placed for immediate development and the DFS has shown that it will generate very attractive returns for its shareholders and joint venture partners alike.”
The Watershed project was expected to produce at a rate of 2.5-million tonnes a year, and would have an initial mine life of ten years. The project has a total resource of 49.32-million tonnes, containing about 70 400 t of tungsten.
“We are continuing to advance Watershed rapidly towards development. Our partner Jogmec is continuing to hold discussions with a number of Japanese companies regarding the transfer of their 30% project interest. This new partner will be responsible for providing 30% of the finance, plus a minimum 30% of the offtake,” Strizek said.