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Alara expects more revenue from Oman

28th June 2018

By: Esmarie Iannucci

Creamer Media Senior Deputy Editor: Australasia

     

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PERTH (miningweekly.com) – ASX-listed Alara Resources has updated the economics of its Al Hadeetha copper project, in Oman, which resulted in higher forecast revenues and earnings before interest, taxes, depreciation and amortisation (Ebitda), but also an increase in preproduction capital costs.

Alara on Thursday said that the updated feasibility study took into account higher copper prices, indicated weighted average costs of capital, as well as revised pricing and tax increases.

The Al Hadeetha project is now estimated to deliver revenues of $561-million over its nearly ten-and-a-half-year life, compared with the $452-million revenue estimate in January last year.

Forecast Ebitda also increased from $159-million to $252-million, while the project’s net present value was up from $39-million to $90-million, and its internal rate of return was up from 26% to 34%.

However, preproduction capital cost was now estimated at $60-million, compared with the 2017 estimate of $49.74-million, while unit operating costs were up from $26.95/t to $27.40/t of processed material.

The processing rate has remained unchanged at one-million tonnes a year, with an average concentrate production of 35 000 t/y.

Meanwhile, project construction time has also increased from 12 months to 14 months, with the project now expected to start production in the fourth quarter of 2019, and to close in 2030.

With the mining licence finalised, Alara is focused on closing project financing to advance construction.

“The Al Hadeetha copper project is the first international mining joint venture to receive a copper mining licence in Oman, and it will not be the last. Alara and its joint venture partners will play a key role in Oman’s resurgent copper industry,” said Alara CEO Justin Richard.

Edited by Mariaan Webb
Creamer Media Senior Deputy Editor Online

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