Name of the Project
Toliara mineral sands project.

Location
The project is based on the Ranobe deposit, located 45 km north of Toliara on a 125.4 km² mining lease, in Madagascar.

Project Owner/s
African mineral sands producer Base Resources.

Project Description
An enhanced definitive feasibility study (DFS) completed in October 2021 has delivered a substantial improvement on the 2019 DFS.

The scaled-up project now supports average production of 960 000 t/y of ilmenite, 66 000 t/y of zircon and 8 000 t/y of rutile in Stage 1, with the first ten years of Stage 2 operations (Year 6 to Year 16) materially higher at 1.21-million tonnes a year of ilmenite, 82 000 t/y of zircon and 9 000 t/y of rutile.

The life-of-mine (LoM) of the project has increased from 33 years in the 2019 DFS to 38 years in the enhanced DFS. Total LoM production is estimated at 55.6-million tonnes.

Stage 1 comprises the engineering, procurement, construction and commissioning of heavy mobile equipment, as well as a dry mining unit, a 1 750 t/h wet concentrator plant, a 150 t/h mineral separation plant, filed services, a power generation facility, a borefield and a camp. It also comprises offices, laboratories and workshops, a haul/access road and bridge, an export facility storage shed, workshop and offices, as well as a jetty multibuoy mooring facility and a shiploader.

Stage 2 production will start about four years after Stage 1 mining has started. It will comprise the engineering, procurement, construction and commissioning of a second dry mining unit, as well as a second 1 750 t/h wet concentrator plant, upgrading the mineral separation facility from 150 t/h to 220 t/h and additional heavy mobile equipment. It will also entail upgrading the power plant capacity to accommodate increased process plant power demand and additional boreholes to accommodate increased water demand.

Potential Job Creation
Not stated.

Net Present Value/Internal Rate of Return
The post-tax net present value, at a 10% discount rate, has increased from $652-million in the 2019 DFS to $1.1-billion in the 2021 DFS. The internal rate of return has increased from 21.4% in the 2019 DFS to 23.8% in the enhanced DFS. Capital payback for Stage 1 and 2 has increased from 4.3 years to 4.5 years.

Capital Expenditure
Initial Stage 1 capital expenditure (capex) has increased from $442-million in the 2019 DFS to $520-million. Stage 2 capex has increased from $69-million to $137-million.

Planned Start/End Date
With project construction expected to take 27 months to complete before first shipment, Base Resources is targeting first product from Toliara by September 2025, and first shipments by December the same year.

Latest Developments
Base Resources has reported that it is “achingly close” to a fiscal agreement with the Madagascar government over the Toliara project.

Speaking at the first day of Paydirt’s Africa Downunder conference, held in Perth on August 31, MD Tim Carstens said the company was hoping to have a fiscal agreement in place over the next few months, allowing it to make a final investment decision (FID) on the project by September 2023.

Base was forced to delay an FID on the Toliara project in 2020, after the Madagascar government had suspended activities at the project area in 2019 as negotiations about the fiscal terms applicable to the proposed mine were initiated.

Since that time, Base has undertaken a second definitive feasibility study (DFS) on Toliara to update the original study, which has resulted in the required capital expenditure for the Stage 1 operation increase from $442-million to $520-million to establish a 13-million-tonne-a-year processing operation.

The Stage 2 operation will require a further investment of $137-million, which is higher than the $69-million previously estimated, to increase capacity to 25-million tonnes a year. The Stage 2 considered in the updated DFS is larger than the 13-million-tonne-a-year operation considered in the original study.

Key Contracts, Suppliers and Consultants
None stated.

Contact Details for Project Information
Base Resources manager of communications and investor relations James Fuller, tel +61 8 9413 7426 or email jfuller@baseresources.com.au.