Elementos Limited has announced the results of a Pre-Feasibility Study on the re-opening of the old Cleveland tin-copper mine in Tasmania and treatment of tailings from historic workings. The company aims to start tailings treatment as early as 2016, thereby generating early cash flow to help fund exploration and development of the underground resource.
The PFS prepared by independent consultants Mining One and pitt&sherry is based on the initial treatment of 650,000 tpy of tailings to produce 1,000 tpy of tin-in-concentrate and 300 tpy of contained copper over a six year life. The underground operation, to be phased in from 2018, would treat 360,000 tpy of ore to produce 1,900 tpy of tin plus 700 tpy of copper in concentrate over 10 years. However Elementos is hopeful that it can expand its resource base to allow a larger scale of production, improving project economics.
Pre-production capital costs are estimated Au$23.9 million for the tailings project and Au$43.8 million for the underground mine. Based on forecast tin and copper prices of US$25,500/tonne and US$6,750/tonne, the ungeared pre-tax NPV of the combined project is estimated at Au$58.1 million. The company believes the staged development strategy, in combination with project finance at each stage, could significantly reduce the future equity capital requirements.
Elementos’ Managing Director, Calvin Treacy commented: “This is a huge milestone for the company. Firstly, turning around a PFS in less than six months, and secondly, but more importantly, demonstrating the economic viability of the Cleveland project with a development model that can be funded by a junior mining company. We now move to the next exciting phase of development, achieving our goal to become the next major tin producer in Australia”.
