PERTH (miningweekly.com) – A prefeasibility study (PFS) into the Beharra silica sands project, in Western Australia, has estimated that the project would require a capital investment of A$77-million to produce some 48-million tonnes over a mine life of 32 years.
Based on a two-million-tonne-a-year operation, producing 1.5-million tonnes a year of silica sands, the PFS estimated that Beharra would have a post-tax net present value of A$236-million and an internal rate of return of 77%, with a pay-back period of two years.
Total life-of-mine (LoM) earnings before interest, taxes, depreciation and amortisation have been estimated at A$1.7-billion, with total LoM free cash flow estimated at A$1.1-billion.
ASX-listed Perpetual Resources on Wednesday told shareholders that considerable upside remained through the further optimisation of the metallurgical circuit, and that there was scope to reduce operating and capital costs at the feasibility stage.
“The finalization and announcement of the PFS results demonstrate that the Beharra silica sand project can produce the highest known quality silica sand product in the Mid West region of Western Australia. After the conclusion of extensive studies across all areas of project focus, the announced outcomes of the Beharra PFS are simply outstanding and suggest a compelling project, across both financial and operating metrics,” said executive chairperson Julian Babarczy.
“In the Perpetual board’s view, Beharra now sits atop all other projects in the region and we are excited to continue our rapid development as we move towards a subsequent project study or a decision to fund later in calendar 2021.”
First production for Beharra is slated for late in 2022.