Name of the Project
Urquhart bauxite project.

Location
The project is located on Queensland’s Cape York, in Australia.

Project Owner/s
Cape York HMS & Bauxite Project Joint Venture (JV), which comprises Oresome Australia, a wholly owned subsidiary of Metallica Minerals, and Ozore Resources.

Project Description
An independent prefeasibility study (PFS) has supported the development of the project.

The project consists of two bauxite plateaus – Area A and Area B – that are wholly contained within mining licence 100044.

The project has a targeted production rate of 1.5-million tonnes a year, producing 6 532 t/y of saleable product over a 5.5-year mine life.

The proposed mining operations are very simple, with the deposit being mined in 160-m-wide strips, which will start in the lower strip ratio and higher-grade material Area A. Strips will be mined contiguously to allow for short hauls to the nearby mined-out strip for dumping overburden (predominantly sand cover) back in-pit, resulting in the continuous rehabilitating of mined-out areas. The target bauxite horizon ranges in thickness from 0.5 m to 4 m and averages 1.5 m. Overburden thickness varies and is thinnest in the eastern part of Area A, which is scheduled for initial production. In scenarios 1 and 2, there will be no screening of bauxite material. Scenario 3 allows for stockpiling of transitional material.

Potential Job Creation
The JV will have minimal staff on site to manage contractors and the shipping of direct shipping bauxite to clients.

Net Present Value/Internal Rate of Return
The updated PFS estimates a pretax net present value, at a 10% discount rate, of A$47.3-million, on sales of 6.5-million tonnes of Urquhart’s proven and probable reserves. The project has a post-tax internal rate of return of 364%. Payback is estimated at 2.2 years.

Capital Expenditure
The updated PFS has confirmed start-up capital of A$2.2-million.

Planned Start /End Date
The highest-margin bauxite in Area A is slated for first production in 2019.

Latest Developments
Metallica Minerals has announced that focus at its Urquhart bauxite project will shift to explore the viability of mining a potential industrial sand product.

Metallica has told shareholders that it is recommending that the JV with private Chinese firm Ozore should delay the completion of a planned PFS into a bauxite operation at Urquhart until the potential industrial sand opportunity has been investigated further, and the JV better understood regarding whether the sand mining opportunity is viable.

The PFS was scheduled for completion at the end of March this year.

Subject to Ozore agreeing to these recommendations, the next stage of investigating the industrial sand opportunity will be to undertake an exploration programme to determine the possible volume and quality of the sand resource at the tenement.

This work will likely require dry season drilling, which will not occur before the third quarter of 2020.

In the interim, Metallica has said that it will progress other aspects of the bauxite project and will endeavour to minimise project and company overhead costs.

Key Contracts and Suppliers
IMC Mining (updated PFS) and LCR Group (mining and haulage operations at Urquhart).

Contact Details for Project Information
Metallica Minerals, tel +61 7 3249 3000, fax +61 7 3249 3001 or email admin@metallicaminerals.com.au.