Photo by: Bloomberg
PERTH (miningweekly.com) – A review of the proposed production ramp-up and export logistics at the Paulsens East iron-ore mine, in Western Australia, has optimised the project’s economics and reduced the up-front capital cost estimates.
ASX-listed Strike Resources on Monday said that a two-stage production schedule is now being proposed for the Paulsens East project, with Stage 1 focusing on surface detrital and low strip ratio material of up to 400 000 t, which will be shipped during 2022.
The Stage 2 operation would produce at a rate of 1.5-million to 2-million tonnes a year, with exports to transition from the Utah Point to the Port of Ashburton in Onslow.
Initial feasibility studies into the project indicates that the 1.5-million-tonne-a-year project will require a capital investment of A$15.7-million, and will deliver a net present value of A$140-million over its four-year mine life.
The review has estimated that an initial capital investment of only A$5-million will now be required, while the Stage 2 ramp-up will be substantially self-funded from the Stage 1 operation.
Total capital cost for the life-of-mine remains at around A$15-million.
First ore production is planned for late 2021 or early 2022, subject to a positive final investment decision.
“Strike has revised its mining ramp up plan for Paulsens East, to minimise up-front capital costs and accelerate the commencement of production,” said Strike MD William Johnson.
“This new plan provides for production growth during 2022 to be potentially funded from early-sales cashflow, reducing the need for dilutive capital raisings. A final investment decision by the company on the project is expected shortly.”