PERTH (miningweekly.com) – ASX-listed Hawsons Iron this week reported that it would modify the bankable feasibility study (BFS) for its namesake project, in New South Wales, following the completion of a strategic review.

The company last year slowed work relating to its BFS to examine escalating costs and to evaluate options to progress the project.

Work on the 10-million-tonne-a-year BFS started in 2021, however, as a consequence of the increased 400-million-tonne mineral resource estimate announced last October, the scope of the BFS was expanded to investigate upscaling the project’s production profile to 20-million tonnes a year, using a direct-to-port slurry pipeline.

The board of Hawsons Iron later endorsed a decision to focus solely on the development of a 20-million-tonne-a-year project, owing to its expanded economics, environmental, social and governance outcomes, and its investment appeal relative to a smaller project.

However, Hawsons this week told shareholders that the BFS would now assess an 11-million-tonne-a-year project, noting that the capital cost estimate for the 20-million-tonne-a-year processing plant was "excessive".

The strategic review also recommended a two-pronged action plan to improve the net present value of the project by reducing processing plant capital costs further and accessing higher grade ore earlier to accelerate startup cash flow.

“The board has endorsed this action plan and approved a A$7.8-million placement and a share purchase plan (SPP) to raise a further A$1-million to fund additional value engineering and a three-stage resource definition programme targeting higher-grade ore from 30 m to 150 m,” said Hawsons chairperson Dave Woodall.

“The outcome of the strategic review is a coherent, viable plan to realise the full value of our globally-significant magnetite resource in response to challenging global economic conditions.”

Woodall said the value-engineering activities and first two stages of the resource analysis programme were expected to be completed during the June quarter of 2023, subject to weather and rig availability.

“We are aiming to complete all this work and achieve the targeted mining and processing economic improvements by the end of the June quarter of 2023 with the objective of then securing a strategic partner to jointly fund a modified BFS assessing an 11-million-tonne-a-year project. Work on this modified BFS could then restart, targeting completion by the end of June 2024.”