- Grange Resources (GRR) releases a pre-feasibility study (PFS) that identifies a significantly reduced-capital development option for its Southdown magnetite project in Western Australia
- The recently completed PFS shows the forecast capital cost of development falling from an earlier estimate of $2.9 billion to $1.39 billion
- The company says the new figure is based on a proposed smaller production rate of five million tonnes per annum (Mtpa) of high-grade magnetite concentrate at 69.5 per cent iron, with an initial mine life of 28 years
- Free cash flows from Southdown are tipped to reach more than $3.1 billion over the operating life, not including the capital expenditure, sustaining capex and operating expenses, according to the PFS
- GRR shares up 2.84 per cent to $1.09
Grange Resources (GRR) has tabled a pre-feasibility study (PFS) identifying a significantly reduced-capital development option for its Southdown magnetite project in Western Australia.
The recently completed PFS shows the forecast capital cost of development falling from an earlier estimate of $2.9 billion to $1.39 billion.
Grange said the new figure was based on a proposed smaller production rate of five million tonnes per annum (Mtpa) of high-grade magnetite concentrate at 69.5 per cent iron, with an initial mine life of 28 years.
A definitive feasibility study completed about 10 years ago pointed to an operation at Southdown producing 10 Mtpa of high-grade magnetite concentrate at 69.5 per cent across a potential mine life of 14 years.
According to the PFS, free cash flows from Southdown were projected to reach more than $3.1 billion over the operating life, not including the capital expenditure, sustaining capex and operating expenses.
Grange said the proposed new mine’s concentrator will use dry grinding technology in order to improve efficiency while reducing power and water demand.
CEO Honglin Zhao said the Southdown concentrate product would be one of the highest-grade seaborne iron ores globally.
“PFS 2022 considers innovation in the process to enable a reduction in the capital required to enable the project to proceed,” he said.
“Southdown is a world-class magnetite deposit that is becoming increasingly relevant as
steel markets continue to demand premium iron ore products.”
GRR shares were trading 2.84 per cent higher at $1.09 at 12:38 pm AEDT.