Heavy Minerals Reveals Strong Garnet Economics Through Port Gregory Scoping Study

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Heavy Minerals aims to produce approximately 141,000 t of garnet and 6,000 t of ilmenite from Port Gregory per year.

A scoping study and preliminary economic assessment for Heavy Minerals’ (ASX:HVY) Port Gregory garnet project in Western Australia confirmed a net present value of $253 million after tax and a revenue forecast of 1. $59 billion over the 16-year life of mine.

The study demonstrated the technically simple and robust nature of the project as well as the significant potential economic value that would flow from future development.

Key highlights included a low capital expenditure requirement of $110 million due to the project’s proximity to the town of Geraldton and existing infrastructure; and low operating expenses and high margins due to simplistic and standard processing requirements to achieve an average annual production of 141,000 tonnes of garnet and 6,000 t of ilmenite.

The after-tax internal rate of return was estimated at 33%, while after-tax free cash flow is expected to be $588 million.

Heavy Minerals CEO Nic Matich said Port Gregory is becoming a long-term economic mining operation.

“The results of the scoping study highlight the robust nature of this project and [this] bodes well for the future as we look to potentially move into the development stage,” he said.

“With a second phase of drilling in the planning stages, the next few months should put us in a position to complete a feasibility study and advance uptake discussions with interested parties.”

garnet market

Mr. Matich said the main constraint of the study relates to the amount of end product (garnet) that could be brought to market given the supply and demand forecasts studied by TZ Minerals International.

The garnet market is believed to be demand driven and Heavy Minerals has taken a conservative approach in sizing the Port Gregory processing plant to minimize excess production.

“There is significant upside potential if demand for garnet increases or if drawdowns exceed the mill’s proposed production,” Matich said.

“The plant was designed in such a way that additional throughput could be [readily] achieved through modularized additions.

Port Gregory Project

Port Gregory comprises six buildings spread over 227.28 square kilometers of land north of Geraldton.

It has a mineral resource estimate of 135Mt grading 4% total heavy minerals (THMs) and 4.9Mt containing garnet.

The project will process the mineralization from surface or with limited overburden removal via conventional bulldozer trap mining from shallow pits to produce a slurry that will be pumped to a wet concentrator plant.

A heavy mineral concentrate will be produced by processing a sand fraction through a series of gravity spirals and updraft classifiers before being transferred to a dry mineral separation plant, where it will be further upgraded by removing materials by magnetic separation.

The magnetic concentrate is dominated by ilmenite and will form a valuable by-product, which will attract around $640/t sold.

The garnet material will then be screened, bagged and shipped to the Port of Geraldton for transport to overseas markets.

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