The delivery of these studies by Crosslands and OPR represents a significant milestone in the ongoing development of the mid-west as a major iron ore producing region.
The studies have indicated commercial, technical and operational viability. The delivery of these studies by Crosslands and OPR represents a significant milestone in the ongoing development of the mid west as a major iron ore producing region. The studies have indicated commercial, technical and operational viability.
Murchison Metals has released the highly anticipated Feasibility Studies for the Crosslands and Oakajee Port and Rail projects. The studies have indicated commercial, technical and operational viability, subject to OPR reaching agreement with potential foundation customers.
Mr Trevor Matthews COO of Murchison Metals said “The delivery of these studies by Crosslands and OPR represents a significant milestone in the ongoing development of the mid-west as a major iron ore producing region, and Murchison looks forward to progressing both projects to the next stage of development."
The results reflect nearly four years of work and over AUD 400 million of expenditure by the respective project teams.
Crosslands feasibility study on the Jack Hills Expansion Project is based on:\
1. Average production of 23.4 million wet tonnes per annum for the first 10 years, comprising 22 million wet tonnes per annum of high purity iron concentrate products and 1.35 million wet tonnes per annum of direct ship products with a total estimated mine life of 39 years, supplying the key Chinese, Japanese and Korean markets;
2. Average operating costs of approximately AUD 33.66 per wet tonne of product, excluding royalties and before infrastructure charges
3. Capital cost of AUD 3.7 billion, inclusive of owners’ costs during construction.
OPR’s feasibility study is based on
1. Development of an integrated port and rail supply chain with engineered capacity of 45 million wet tonnes per annum, with a planned contracted throughput of 42 million wet tonnes per annum
2. Average operating costs of AUD 5.45 per we ton of throughput;
3. Capital cost of AUD 5.94 billion inclusive of owners’ costs during construction
3. Direct capital costs of AUD 5.43 billion versus AUD 5.24 billion for November 2010 Budget and Engineering indicative estimate.
Murchison added that the material approvals for both projects are well advanced while the Supply Chain Agreement process between OPR and its potential foundation customers is incomplete, Murchison expects that all parties will ultimately reach agreement around commercial arrangements.
The studies assume Project Go Ahead in the March Quarter 2012 with first shipping through Oakajee targeted for 2015.
Murchison considers that this schedule is dependent on the timing of completion of SCAs and related milestones, with the company continuing to review funding options and opportunities. Murchison will now continue with a strategic review post the release of theses Feasibility Studies.
Murchison’s 50:50 joint venture partner in Crosslands and OPR is Mitsubishi Development Pty Ltd.
(Sourced from www.proactiveinvestors.com.au)
