Name of the Project
Southdown magnetite project.

Location
North-east of Albany, in the south-west (corner of) Western Australia.

Project Owner/s
Southdown is a joint venture (JV) between Grange Resources (70%) and SRT Australia (30%). SRT is jointly owned by the Sojitz Corporation, a Japanese global trading company, and Kobe Steel, the third biggest Japanese steel maker.

Project Description
A prefeasibility study (PFS) completed in February 2022 has identified a reduced-capital development option.

The project has 1.2 billion tonnes of high-quality mineral resources, including ore reserves of 388-million tonnes.

The definitive feasibility study (DFS), completed in 2012, defined a ten-million-tonne-a-year operation producing high-grade magnetite concentrate at 69.5% iron over a potential mine life of 14 years.

The PFS proposes a smaller, five-million-tonne-a-year concentrate production operation within the constraints of existing mineral resources and ore reserves. This proposal extends the life of mine to 28 years for the western zone and to potentially more than 50 years for the total resource.

The PFS envisages a pit-to-port operation involving:

• an opencut mine with contract mining;
• a concentrator, including dry grinding and wet separation techniques;
• slurry and return water pipelines from and to the port at Albany;
• a transshipping operation to export concentrate in Cape-size vessels;
• a transmission line for power supply by a third party to access a significant component of renewable energy; and
• a mix of recycled and groundwater to supply reduced water needs.

The 2012 DFS remains the base option, and the decision to take the alternative option to DFS will be considered by the JV partners.

Potential Job Creation
Not stated.

Net Present Value/Internal Rate of Return
The 2022 PFS estimates a net present value, at a 10% discount rate, of A$243-million and an ungeared internal rate of return of 12%, based on average price assumptions from long-term forecasts of $102.52/t freight onboard Albany at an A$/$ exchange rate of $0.71.

Capital Expenditure
Initial capital expenditure is estimated at A$1.39-billion, compared with A$2.9-billion in the 2012 DFS.

Planned Start/End Date
Not stated.

Latest Developments
None stated.

Key Contracts, Suppliers and Consultants
Wood (principal and process studies) and subconsultant GHD (nonprocess infrastructure); Ausenco (pipeline); BMT (marine studies); and Snowden Optiro (mining studies).

Contact Details for Project Information
Grange Resources, tel + 61 3 6430 0222 or email info@grangeresources.com.au.