THE BOURSE WHISPERER: IronClad Mining (ASX: IFE) has received approval from the Government of South Australia for the company’s planned development at the port of Lucky Bay on the Eyre Peninsula.
This is the final approval the company was waiting to receive , which means it is now able to commence work on the Wilcherry Hill iron ore project, an 80 per cent : 20 per cent Joint Venture with Trafford Resources (ASX: TRF).
IronClad explained the application was made in order to amend a requirement that it transports ore in closed containers from the mine site, 40 kilometres North of Kimba, to the wharf side at Lucky Bay.
The application also requested the establishment of a modest bulk ore stockpile facility at the port and a reduction of required container numbers from over 3000 to 250, which the company said
would greatly reduce the project’s financial impost.
“The amendment application resulted in an additional 46 items requiring significant further input by IronClad / Sea Transport Corporation (STC) on issues such as (but not limited to) dust, acoustics and stormwater, including data gathering, modelling and the formulation of detailed operational control management plans,” IronClad Mining said in its ASX announcement.
“The company’s comprehensive response to all questions has allowed the Minister for Planning to approve IronClad’s port development plans, subject to the implementation of normal operational conditions and environmental safeguards.”
IronClad has completed a 12 month review of the project’s economics, which has resulted in the start-up capital requirement for Stage 1 remaining close to budget at approximately $15 million, despite operating costs being trimmed by approximately 25 per cent.
The company admitted the purchase and construction of a company-owned and run crushing plant is likely to add a further $6 million to the start-up price tag, however it will also create worthwhile operating cost savings.
“Total capital requirement, including contingencies will, therefore, be in the order of $22 million,” IronClad said.
“The main capital works of approximately $6 million to $7 million will be at the port of Lucky Bay.”
IronClad explained it has been involved in negotiations to debt finance the remaining capital for some time, however, these have been somewhat hamstrung due to the uncertainty over the port approvals.
With that approval being stamped, IronClad anticipates finance negotiations will gather some momentum.