Name and Location
Urquhart Point heavy mineral sands (HMS) project, Queensland, Australia.

Client
Metallica Minerals and joint venture (JV) partner Ozore Resources.

Project Description
A positive feasibility on the Urquhart Point project supports the economics for a five-year mine life based on current ore reserves of 1.18-million tonnes grading at 9.5% heavy minerals, 8% oversize and 1% slimes. The heavy minerals assemblage is estimated to be 11.7% zircon, 13.6% rutile and 13.1% ilmenite. The reserves are located at surface, averaging between 1.5 m and 2 m in thickness.

The feasibility study proposes a simple, shallow dry-sand mining and conventional wet gravity-separation plant operation using spirals, with no chemicals required, to produce a mixed heavy-mineral concentrate product.

Concentrate production is estimated at 87 000 t, with an average valuable heavy mineral assemblage of 14.8% zircon, 17.3% rutile and 16.2% ilmenite, with the balance comprising predominantly iron oxide sands.

Net Present Value/Internal Rate of Return
The estimated project pretax net present value is A$4.9-million and the internal rate of return is 69%, with a one-year payback period from the start of operations.

Value
Capital expenditure is estimated at A$6.5-million.

Duration
Subject to the finalisation of funding, project preconstruction works can start within two months, with the project starting production one year thereafter.

Latest Developments
Metallica and its Chinese JV partner have started development work of the Urquhart Point HMS project, in Cape York, China's Ozore Resources owns a 33.33% interest in the project following a A$5-million payment.

Under the JV, Ozore Resources will provide about A$7.5-million in funding to develop the project and explore for other HMS and bauxite deposits on the nearby tenement areas, as well as north of Weipa.

The Chinese investor has committed to a final A$2.5-million instalment on the JV, which will take its shareholding in the JV to 50%.

First production from the HMS project has been targeted for mid-2015, and Metallica will be free-carried to expenditure of A$7.5-million, which is budgeted to bring the project to production.

Key Contracts and Suppliers
None stated.

On Budget and on Time?
Not stated,

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