METRO Mining has completed the Definitive Feasibility Study (DFS) for the Stage 2 expansion of its Bauxite Hills Mine in north Queensland with estimated reserves of 109.5Mt and a mine life out to 2037.
Once completed, the expansion will reduce unit operating costs and increase production capacity to 6M Wet Metric Tonnes (WMT) pa from 2021 onwards.
Metro managing director and chief executive officer Simon Finnis said the completion of the feasibility study and selection of the preferred design for the FT was a key step to allow execution of the expansion at Bauxite Hills.
“It builds on the outstanding production performance and operating experience gained since the mine commenced production in April 2018,” Mr Finnis said.
“It is pleasing to see the DFS completed and we thank shareholders for their patience.
“The DFS clearly shows that the expansion confirms Bauxite Hills as one of the lowest cost and largest independent producers of bauxite in the market.”
The Stage 2 expansion is expected to result in reduction in operating costs through the use of a Floating Terminal (FT) that can load larger, ungeared Ocean-Going Vessels (OGVs), including Cape Size vessels.
Capital costs are estimated to total around $51.4m (including 10pc contingency), with the FT comprising around 85pc of the total expansion capital and accommodation camp expansion, port area modifications and fleet additions making up the remainder.
Life-of-mine unit operating costs are forecast to reduce by about 18pc delivered to China when operating at the 6M WMTpa rate, which will increase operating margins.
This will position Bauxite Hills in the lowest quartile of the global cash cost curve for bauxite producers, with project payback anticipated to take less than 18 months.
“We have some further work to do on the final design, and we need to finalise the funding package, and then we will present to the board for their approval,” Mr Finnis said.
Metro has appointed Rocktree Consulting to complete the engineering, design and supplier quotation of the FT, expected to be completed in November this year, with commissioning of the FT planned for Q1 2021.
