THE BOURSE WHISPERER: Galena Mining (ASX: G1A) released details of a Scoping Study undertaken at the company’s 100 per cent-owned Abra base metal project in Western Australia.
Galena Mining said the Study had confirmed Abra as an economically and technically robust opportunity, with potential to become a long-life, high margin West Australian lead-silver producer.
Study results include:
Initial mine life of 11 years, with opportunities identified to extend beyond 11 years;
Annual throughput of one million tonnes per annum, with average grades of 9.7 per cent lead and 15 grams per tonne silver, producing 91,000 tonnes per annum of lead and 450,000 ounces of silver annually; and
Average life of mine cash (C1) costs of US$0.46 per pound and total costs (C3) costs of US$0.56 per pound (includes all royalties) – high margin, strongly cash generative operation.
Galena declared exploration potential exists to add to the lead-silver mineralisation already identified to be converted to JORC Resource with additional drilling.
The company believes the potential development of Abra coincides with a very strong outlook for lead with increasing demand and reducing supply producing an average spot lead price of US$0.97 per pound over the last 10 years.
Base case analysis in the study uses a US$0.95 per pound lead price.
On the back of the study results, Galena has signalled it is progressing into the next phase of work at Abra, across multiple fronts and at a maximum pace.
A Pre-Feasibility Study (PFS) is due for completion in September 2018.
“This Scoping Study has confirmed the economic viability of the Abra project and has increased our confidence in the real potential of the project as a near-term Western Australian development opportunity,” Galena Mining CEO Ed Turner said in the company’s announcement to the Australian Securities Exchange.
“This is an exciting long life, high margin and low capital project in a Tier-1 jurisdiction.
“Abra’s latest representative metallurgical test work demonstrates that it can produce a very high-grade (74.5 per cent lead and 140g/t silver), high quality clean concentrate that is in high demand.”