Magnetite Mines Limited (ASX: MGT) is confident its updated base case 5Mtpa has boosted the proposed operation at the wholly-owned Razorback Iron Ore Project in South Australia.
The update incorporates the results of recently completed optimization studies and is underpinned by a revised Ore Reserve estimate that includes the separately announced maiden Ore Reserve for the Iron Peak deposit.
Iron Peak is the highest-quality deposit within the Razorback Project to date and has delivered a significant positive impact on overall project economics, particularly in the critical first ten years of operations. The project is located in the Braemar Iron Ore Province of South Australia.
Key outcomes include:
- Two magnetite concentrate production scenarios have been modelled: Base Case: fixed output 5Mtpa operation with no expansion Expansion Option: staged expansion from 5Mtpa to 10Mtpa after five years
- Early year cash flows, capital costs and operating costs have been significantly improved by the prioritization of Iron Peak ore resulting in a breakeven cost profile that remains competitive throughout the commodity price cycle.
“We are positioning our wholly-owned, high-value and long-life Razorback Iron Ore Project to align with the transition occurring in the global iron and steelmaking sector,” CEO Tim Dobson said.
“South Australia is fast emerging as a desired Tier 1 location for regional steel producing nations to establish ‘green iron’ hubs based on proximity, existing infrastructure, stable regulatory environment, mandated 100%-renewable energy, emerging green hydrogen availability and abundant potential for high-grade magnetite concentrate production. Within this transition, Razorback is ideally positioned at the front of the pack of next- generation magnetite producers.
“This project update combines the successful delivery of the optimization study phase with the just- announced maiden Ore Reserve for the high-quality Iron Peak deposit, which is now prioritized for production in the project plan and improves the first ten years economics significantly.
“Our financial modelling has been deliberately conservative, incorporating adequate contingencies and acknowledging the recent inflationary cycle, while also reflecting emerging product price premiums for premium-grade iron ore products that are forecast to increase over the coming years as the global steel industry delivers on its urgent decarbonization commitments.
“Our next steps are to de-risk the final elements of Razorback’s infrastructure requirements, which will allow us to complete a Definitive Feasibility Study and commence a partnering process aimed at sharing capital and marketing risk with quality partners to deliver the best possible outcome for Magnetite Mines shareholders.”
For further information please visit: https://magnetitemines.com/