PERTH (miningweekly.com) – A scoping study by junior Equatorial Resources has indicated that an initial capital investment of $114-million would be required to develop the Mayoko-Moussondji iron project, in the Republic of Congo.

The study evaluated the three-staged development of the project, incorporating both a hematite and magnetite resource. Stage 1 of the project would see the development of a 500 000 t/y operation, based on the maiden hematite resource of 102-million tonnes, at 40.6% iron, while Stage 2 would see the project ramping up to two-million tonnes a year, within 18 months.

“The scoping study has identified an immediate pathway to a two-million-tonne-a year hematite mining operation producing a premium product transported by the existing railway and port facilities,” said Equatorial MD and CEO John Welborn.

“The study demonstrated that our project has a number of advantages; the potential for a high-quality product, low capital requirements, competitive operational costs, and a short timeframe to production based on access to existing rail and port infrastructure.”

Welborn noted that these advantages, and the potential for future expansion, made Mayoko-Moussondji a “stand-out” development opportunity.

Based on the initial hematite resource, the project would have an estimated mine life of some 23 years. The first six years of mining was based on the indicated mineral resource, with the remaining years based on inferred material.

While initial capital expenditure has been placed at $114-million, the total capital cost to develop the project to a two-million-tonne-a-year operation would be $231-million. However, Welborn pointed out that the cost could be reduced through leasing arrangements on rolling stock, improvements to tailings management, and through partnership opportunities with its neighbour Exxaro Resources, which is developing the Mayoko-Lekoumou project.

Equatorial said it had enlisted WorleyParsons to look at ways of optimising transport solutions for its project, including integrating Exxaro’s systems so that both companies could benefit from future operating synergies.

Equatorial was now hoping to secure a partner to help fund the development of the Mayoko-Moussondji project, and said that it was exploring a “number of opportunities” for on- and off-balance-sheet arrangement and strategic partnership.

Equatorial would also immediately start its application for a mining licence for the project, which would be lodged with the relevant authorities during the second half of the year.