A review of Rex Minerals’ Hillside copper project on the Yorke Peninsula has resulted in an optimised mine plan that will deliver a higher production profile and lower start-up capital costs. The mine plan will form the basis for the Hillside bankable feasibility study (BFS) later in 2013; it suggested the combination of a new interim open pit design and multiple ore stockpiles, to allow for higher grade material to be delivered to the processing plant.
Based on this model, Rex reported that the average grade delivered to the processing plant between its third year and tenth year would be about 0.6 per cent, plus gold and iron by-product credits.
During this period, annual copper production would be about 80,000t with recovered gold of more than 60,000oz and more than 1.2 million tonnes of iron ore concentrate. This production rate would result in an average copper equivalent production of about 115,000t for the period.
Metallurgical testwork conducted since Rex’s 2012 pre-feasibility study has already shown an increase in average copper recoveries, from 85 per cent to 88 per cent, and in average gold recoveries, up 2 per cent to 84 per cent.
The final stage of metallurgical testwork for the BFS involves the collection of large-scale drill cores, which will be processed with a smaller version of the proposed Hillside processing plant. This stage is likely to be completed by the end of May.
Rex’s latest review also resulted in lower costs for the start-up of the proposed 15mtpa operation.
The announcement stated that potential savings had been indentified in comparison to the PFS results, coming from a number of areas including modularisation, reduced pre-strip and engineering procurement construction contractor options.
While the company didn’t mention the amount of money saved, it noted “the combined capital savings associated with the BFS is anticipated to be significant and will reduce the amount of capital required for Rex to commence production at Hillside”.
Rex managing director Mark Perry said the work completed as part of the BFS had added substantial value to the Hillside project’s economics.
“The extra revenue from higher grades and recoveries has substantially enhanced our ability to lock in funding for Hillside, allowing us to progress meaningful discussions with a number of parties actively engaged in funding proposals for the project,” he said. Subject to achievement of a complete finance package and required approvals, Rex remains on track to begin construction at Hillside in 2014, with start-up anticipated the following year.