THE BOURSE WHISPERER: Sheffield Resources (ASX: SFX) has completed a Pre-feasibility Update on the company’s 100 per cent-owned Thunderbird mineral sands project, located near Derby in Western Australia.
The PFS Update has reduced pre-production capital expenditure for the project by 26 per cent taking it down to $271 million.
The new figures also include a 13 per cent increase in annual EBITDA to $135 million, improvement of capital payback to 3.4 years and a 25 per cent increase in mine life to 40 years.
The company explained the PFS Update has been based on a conventional dozer trap mineral sand mining operation involving an initial 12 million tonnes per annum (Mtpa) throughput, increasing to 18Mtpa in year eight, and a low risk, conventional processing flow sheet with all infrastructure located on site.
“The PFS update has confirmed that the Thunderbird project is a strategic, high margin, zircon-rich asset located in one of the world’s most stable mining jurisdictions,” Sheffield Resources managing director Bruce McQuitty said in the company’s announcement to the Australian Securities Exchange.
“It is a project that requires modest capital expenditure yet generates strong EBITDA margins over a very long mine life.
“We have carefully developed the updated PFS using proven, cost-effective conventional mining and processing techniques.
“Importantly, we have shown that Thunderbird will generate a highly marketable suite of products.
“The primary zircon is of premium quality whilst the upgraded ilmenite demonstrates characteristics that are superior to other sulphate ilmenites in the market, meaning it should become a preferred feedstock.
“Whilst there has been strong interest in relation to Thunderbird’s products, the company has chosen not to commit to offtake agreements until after completion of the DFS.
“Thunderbird is an asset of strategic importance in the global mineral sands industry and of State significance in Western Australia.”