THE BOURSE WHISPERER: VRX Silica (ASX: VRX) released a double banger by announcing details of a Bankable Feasibility Study (BFS) and maiden Probable Ore Reserve at the company’s Muchea silica sand project, located north of Perth in Western Australia.
VRX noted this is the third BFS for the company’s three advanced silica sand projects.
The Probable Ore Reserve for Muchea totals 18.7 million tonnes at 99.9 per cent silicon dioxide (SiO2) – as reported in accordance with the JORC Code 2012 – with 14.6 million tonnes at 99.9 per cent SiO2 contained within the area of the company’s Mining Lease application (M70/1390) for Muchea.
This Ore Reserve follows the company’s recent announcement of Probable Ore Reserves for Arrowsmith North and Central.
“This Reserve estimate is only a small portion of the silica sand Inferred Resource Estimate for the project but produces a very high-grade product which is in high demand in specialist Asian markets,” VRX Silica managing director Bruce Maluish said in the company’s announcement to the Australian Securities Exchange.
“We have already had significant interest in the Muchea product that will command higher prices than products from our Arrowsmith North and Central silica sand projects.
“Muchea is a world class high-grade silica sand project which can support a substantial export industry for WA providing benefits to the State and the Muchea-Gingin district.
“Muchea will produce alternative high-grade products to Arrowsmith and will add to our available catalogue of products from our silica sand projects.”
The BFS was based on only 25 years production from a potentially long-term plus-100-year mine life.
The maiden Probable Ore Reserve of 14.6 million tonnes contained within the area of the company’s Mining Lease application and will support a 9 to 10-year project.
This is estimated from the Indicated Mineral Resource only and constitutes approximately 39 per cent of the estimated total production target – in terms of processed tonnes of silica sand – over the 25-year mine life.
VRX Silica intends to mine solely from Probable Ore Reserves during the initial 9 to 10 years of the project.
VRX Silica has developed a mining and rehabilitation methodology specific to the environment at Muchea, which will enable a successful restoration of mined areas.
A key challenge for industrial minerals projects is meeting market specifications.
The silica sand market has specifications for parameters such as purity in addition to tight specifications for trace elements in the glass industry.
The company is confident that it can meet specifications for the ultra-clear glass market from Muchea.