THE BOURSE WHISPERER: Bulk commodity developer, NSL Consolidated has commenced construction on its US$2.3 million Kurnool iron ore beneficiation project in India.
The company’s schedule should result in it initiating first stage commissioning of the plant by year’s end and deliver maiden revenues in the first half of.
Work is underway on the plant site works program, which is located on a 12 acre stockyard site at Kurnool in the south-eastern Indian state of Andhra Pradesh.
All site surveys have been completed and selection of an earthworks contractor has also been finalised, which is in process of mobilising to site.
The stockyard is located adjacent to NSL’s existing Kuja mine and five kilometres from the company’s Mangal mine, both of which are currently the subject of mine design and production schedule work as the ore sources for plant start-up.
The order process with suppliers for equipment continues as part of the beneficiation plant project.
At this stage in time, NSL claims to be the only foreign company granted the right to own and operate iron ore mines in India, which is the world’s third largest iron ore exporter in parallel with having a strong domestic steel market.
“The Kurnool plant has the potential to lift our ROM iron ore grades to between 58 per cent to 61 per cent iron from as low as 25 per cent to 27 per cent iron, and with good yield and recovery rates,” NSL Consolidated managing director Cedric Goode said in the company’s announcement to the Australian Securities Exchange.
“Our ability to value-add low grade ores from the area was highly supported by the Expert Appraisal Committee from the Ministry of Environment and Forests.
“Our trial mining has provided NSL with accurate cost estimates for all aspects of mining, crushing, screening and transport to port from Kurnool and our financial modelling suggests a return on capital within just three months of reaching full commissioning.
“The Kurnool plant will have the capacity for annual throughput of 196,000 tonnes of concentrate, which would deliver a steady net cash flow of US$800,000 per month once commissioning is completed and throughput stabilised.”
Final commissioning of the Kurnool plant will deliver maiden revenue for NSL as well as opening up additional revenue generating opportunities from beneficiation of third party ores from a number of iron ore deposits within the Cuddapah Basin area of Andhra Pradesh.
NSL is currently in discussions with project owners to gain access to these additional iron ore sources.
Development of an Indian iron ore production business is one of two bulk commodity growth strategies for NSL Consolidated – the other being exploration and development of its suite of thermal coal assets in Queensland.