PERTH (miningweekly.com) – ASX-listed Australian Mines has updated the economics and mine plan for its Sconi cobalt/nickel/scandium project, in Queensland.
The company on Thursday said that Sconi’s projected mine life has increased from the 18 years considered in the bankable feasibility study (BFS), to 30 years, on the back of a 69% increase in the ore reserve, which now stood at 57.3-million tonnes.
In light of the updated ore reserve, Australian Mines also developed new pit designs for both the Greenvale and Lucknow ore, while maintaining its design for the Kokomo pit.
Sconi is now expected to produce more than 1.4-million tonnes of nickel sulphate, 209 000 t of cobalt sulphate and 1 441 t of scandium over its mine life, producing an average of 46 800 t/y of nickel sulphate and 7 000 t/y of cobalt sulphate based on a two-million-tonne-a-year operation.
The additional mine life has increased the projected life-of-mine revenue by 44%, to A$13.3-billion, while total free cash flow projections have increased by 93%, to A$5-billion.
The project’s pre-tax net present value has also increased by 12% on the BFS, to A$1.47-billion, while the pre-tax internal rate of return has been estimated at 20%.
Capital costs for the project have been maintained at $974-million, with total C1 cash costs net of cobalt and scandium estimated at $1.46/lb of nickel.
Australian Mines MD Benjamin Bell on Thursday said that the additional tonnage at Sconi formed the basis of the revised mine plan and the ongoing refinement to the company’s BFS, with the company continuing work to maximise value for shareholders.
The Sconi project was declared a prescribed project by the Queensland government earlier this year, with Australian Mines committing to providing opportunities for local residents and businesses.
Some 500 staff will be employed at Sconi during construction, and once in production, the project would require a staff of 300 people.