PERTH (miningweekly.com) – The Woodlawn zinc/copper project, in New South Wales, has been revealed to have a post-tax net present value of around A$300-million.
Project owner Heron Resources on Wednesday noted that a preliminary economic assessment (PEA) had also estimated that the project would have a post-tax internal rate of return of 46%.
Over the 11-year mine life, the Woodlawn project was expected to produce some 353 000 t of zinc, 77 000 t of copper, 112 000 t of lead, 8.9-million ounces of silver and a further 59 000 oz of gold.
C1 costs of $0.01/lb of zinc were expected to place the project in the lower half of the cost curve.
The PEA also estimated that the project would generate a net cash flow after tax of A$594-million.
“This PEA study confirms not only the economic viability of the Woodlawn project, which has the potential to deliver a long-term supply of zinc into a supply constrained market, but also the quality of this asset with a very competitive cost of production within the current market,” said Heron chairperson Craig Readhead.
“The project is underpinned by a revised, high-quality mineral resource, including the discovery of 2.8-million tonnes from recent drilling, and has achieved its aim of establishing a robust resource base on which to build a new operation.”
Readhead added that the PEA further demonstrated that the approach of co-treating the low-risk tailings resource with the high-grade underground resource could deliver a robust outcome, and a low-cost, long-life mining operation.
“We are now committed to advancing this project rapidly through to feasibility study stage.”
The feasibility would likely be completed by mid-2016.