- A scoping study for Heavy Minerals’ (HVY) Port Gregory project has demonstrated its “robust nature” as well as its significant potential to generate economic value
- The WA-based project has an initial 16-year mine life, with total revenue estimated to be $1.59 billion
- Around $110 million is required to bring it into production, and HVY expects it to produce 158,000 tonnes of heavy mineral concentrate per annum with a payback period of 4.2 years
- Heavy Minerals is planning a phase two drilling program at Port Gregory and will undertake a feasibility study and offtake discussions over the next few months
- Company shares are down 2.7 per cent and are trading at 18 cents at 3:13 pm AEST
Heavy Minerals (HVY) has completed a scoping study for its Port Gregory garnet project in Western Australia.
The company said the scoping study demonstrated the “technically simple and robust nature” of the project as well as its significant potential to generate economic value.
The Port Gregory project is made up of six tenements covering 227.28 square kilometres and lies 50 kilometres north of Geraldton. It has a mineral resource estimate of 135 million tonnes at four per cent total heavy minerals for 4.9 million tonnes of contained garnet.
Executive Director and CEO Nic Matich said the Port Gregory scoping study showed the potential for the project to become a long-life and economic mining operation.
“The results of the scoping study highlight the robust nature of the project and bodes well for the future as the company looks to potentially transition to the development stage,” Mr Matich said.
The scoping study evaluated eight production and processing scenarios, with scenario six ultimately selected as the production and financial case.
As outlined under scenario six, Port Gregory will have an initial 16-year mine life, with the potential to extend this through further drilling, and will produce 158,000 tonnes of heavy mineral concentrate (HMC) per annum.
Due to its proximity to existing infrastructure and industrial hub, Port Gregory is estimated to be a low CAPEX project, with $109.5 million required in development costs to reach production. The project also has a relatively short payback period of 4.2 years.
In terms of operating costs, the company estimates that $38.1 million will be required each year.
Another highlight of the study is it has a “substantial” net present value of $253 million after tax and a “significant” life-of-mine revenue of $1.59 billion.
Heavy Minerals is currently planning a phase two drilling program at Port Gregory, which it believes will support a feasibility study and the progression of offtake discussions.
Company shares were down 2.7 per cent and are trading at 18 cents at 3:13 pm AEST.