PERTH (miningweekly.com) – A definitive feasibility study (DFS) into the Gabanintha vanadium project, in Western Australia, has found that it could support a 27.9-million-pound-a-year vanadium pentoxide operation with a mine life of 16 years, establishing the project as the world’s largest primary vanadium producer.
The DFS estimated a pre-production capital cost of $318-million, with a pay-back period of 3.2 years, owner Technology Metals Australia said on Wednesday.
The project is expected to deliver mine-life earnings before interest, taxes, depreciation and amortization of A$4.1-billion and an estimated free cash flow of A$1.09-billion, with a pre-tax net present value of $924-million and an internal rate of return of 34%.
“The very high quality Gabanintha vanadium project DFS has generated an outstanding result, delivering lowest quartile operating costs over a long initial mine life at a scale that will make the project the largest single primary vanadium producer in the world,” said Technology Metals MD Ian Prentice.
“Delivery of this study is a key milestone in progression of discussions with prospective development partners that the company has engaged with over the past 12 to 18 months,” he added.
Production from Gabanintha is planned to start in 2022, with the application of a conservative ramp-up period, based on achieving the overall plant design capacity of 85% after two years, and the final 15% realised in the third year of operations.
With the DFS work now completed, Technology Minerals will work to progress offtake and financing discussions while also advancing environmental approvals and the grant of a mining lease.
The ASX-listed company will also start a front-end engineering and design study.