JOHANNESBURG (miningweekly.com) – Following its announcement last week that it had executed a farm-in and joint venture agreement to explore for graphite in Western Australia, ASX-listed explorer Mineral Commodities (MRC) announced Monday that it had completed a scoping study and produced the resultant preliminary economics to underpin a near-term project development profile for the Munglinup graphite project, located in the Western Australia’s global Tier 1 mining jurisdiction.
MRC said the scoping study had been undertaken to assess the potential viability of an openpit mine and graphite-processing facility to be constructed on-site at Munglinup, as well as to optimise and schedule the site’s five “discrete yet proximal” graphite deposits, and to provide a production target for the site.
The results of the scoping study demonstrate the site’s potential to support a very-low-capital and low-operating-cost operation at a realistic scale of production, with an estimated yearly graphite concentrate production of about 56 000 t over an initial mine life of nine years.
The total capital cost of the project is estimated at A$47-million, the lowest capital intensity of its peers. MRC noted that, using conservative graphite pricing assumptions, the payback period would be less than two years.
“The scoping study results unequivocally demonstrate, that by any peer analysis, the Munglinup project is a high-grade world-class asset with all key operating parameters falling within the most favourable quartile,” noted MRC executive chairperson Mark Caruso.
He added that the current market fundamentals in the renewable energy sector and electric vehicle market, as well as the advanced stage of Munglinup, were compelling enough to support an accelerated project development timetable.
“Importantly, this project is set aside from the majority of its peers by being in a Tier 1 mining jurisdiction and close to all required infrastructure. The current resource supports the mine life for nine years but is open in all directions and at depth.”
Caruso concluded that the development of Munglinup to production perfectly complements MRC’s Tormin high-grade mineral sands asset, in South Africa, and that it would provide revenue growth and sustainable earnings into the future.
As a result of the scoping study outcome, MRC noted that it had already started comprehensive metallurgical testwork at Munglinup, as well as a drilling programme required for a prefeasibility study, which was due for completion in January 2018.