Name of the Project
Thunderbird mineral sands project.

Location
The project is located near Derby, in Western Australia.

Client
Sheffield Resources.

Project Description
A bankable feasibility study (BFS) has demonstrated a financially robust and technically strong project with a 42-year mine life. The BFS is underpinned by one of the world’s largest and highest-grade zircon- and ilmenite-rich mineral sands ore reserves, totalling 680.5-million tonnes grading 11.3% in heavy minerals.

The BFS is based on a conventional dozer trap mineral sands mining and processing operation involving an initial 8.5-million-tonne-a-year throughput (single mining unit), doubling to 17-million tonnes a year in Year 5 through a second mining unit and processing stream.

The first stage of the project is expected to produce more than 500 000 t/y of saleable product and the second stage more than one-million tonnes of saleable product a year, with a life-of-mine average of about 800 000 t/y.

Over its mine life, the project is expected to deliver an estimated 761 000 t/y of premium zircon, 68 500 t/y of zircon concentrate, 387 800 t/y of ilmenite and 229 800 t/y of titanomagnetite.

Potential Job Creation
Not stated.

Net Present Value/Internal Rate of Return
The project has an estimated net present value, at a 10% discount rate, of A$676-million and an internal rate of return of 25%.

Value
Stage 1 capital has been estimated at A$348-million and Stage 2 at A$195-million.

Duration
The first stage is expected to start in 2019 and end in 2023. Stage 2 is expected to start in 2024.

Latest Developments
Sheffield Resources has warned of a cost blow-out of about A$115-million at its Thunderbird project.

The Stage 1 capital cost is expected to be about A$463-million, compared with the A$348-million estimated in the 2017 BFS.

The company has said that an estimated A$50-million of the costs pertain to scope changes to the project, while a transition from a build-own-operate model to infrastructure ownership will result in a further increase of A$65-million increase to the costs.

The company has said that 80% of the increase in the capital cost will be covered by the proposed funding facilities from the North Australia Infrastructure Facility (NAIF), and as a result, the project will require only A$20-million of additional equity funding compared with the previous estimate.

This amount does not include ramp-up working capital, corporate overheads or financing costs.

Sheffield currently has a $175-million debt facility that will be provided by Taurus Mining Finance Fund and Taurus Mining Finance Annex Fund, as well as A$95-million worth of long-term debt facilities provided by the State of Western Australia, for which the NAIF has made an investment decision.

The NAIF funding will include a A$30-million project development facility and a A$65-million infrastructure development facility.

Sheffield has said that the facilities of the NAIF will enable the company to acquire power generation, gas storage, accommodation facilities and other key infrastructure, as well as reduce the overall operating costs, following the removal of the build-own-operate-related capital recovery charges.

Meanwhile, all key permits necessary to start the development of the Thunderbird project are in place, and the company is progressing an engineering, procurement and construction contract to derisk the project development.

Key Contracts and Suppliers
None stated.

On Budget and on Time?
Not stated.

Contact Details for Project Information
Sheffield Resources, tel +61 8 6555 8777, fax +61 8 6555 8787 or email info@sheffieldresources.com.au.