Metro Mining Releases Bauxite Hills BFS and Upgrades Reserves

THE DRILL SERGEANT: Metro Mining (ASX: MMI) announced completion of a Bankable Feasibility Study (BFS) for the company’s Bauxite Hills mine, located approximately 95 kilometres north of Weipa on western Cape York in North Queensland. 

Metro Mining said the BFS, was completed by MEC Mining, had confirmed strong financial returns from the project, including:

Initial capital cost of $35.8 million (including 10% contingency);
Average annual EBITDA of $145 million;
After tax NPV10 of $601 million;
After tax IRR of 81 per cent;
Life of mine revenue of $5.7 billion and life of mine EBITDA of $2.5 billion.

The BFS determined a 17-year initial mine life with production to commence in April 2018 at an initial rate of 2 million tonnes per annum ramping up to a steady state 6 million tonnes per annum over the first four years.

Metro Mining said the BFS had also demonstrated benefits from the company’s acquisition of Gulf Alumina Limited in December 2016.

“The completion of the Bankable Feasibility Study is an enormous achievement for the company and a testament to MEC, Metro’s project team and the quality of the project,” Metro Mining managing director Simon Finnis said in the company’s announcement to the Australian Securities Exchange.

“The BFS also confirms the benefits of acquiring Gulf allowing one integrated development plan across both asset bases.

“We look forward to moving into the construction phase in mid-2017 once all environmental approvals have been received and funding secured.”

The BFS integrated the resources acquired from Gulf Alumina, resulting in an increase to the company’s total ore reserve to 92.2 Million tonnes.