Rex Minerals Ltd (ASX:RXM) has elected to move ahead with project financing and operational readiness plans following completion of the Optimised Feasibility and Definition Phase Engineering Study (OFS) for the giant Hillside Project.
The 100%-owned Hillside Project is one of the most significant copper-gold projects in Australia and is located less than two hours’ drive from Adelaide, South Australia.
High level key points:
* Project Value for Stage One
o Net Present Value (NPV) A$1,252M (pre-tax), NPV of A$847M (post-tax)
o Internal Rate of Return (IRR) of 19% (nominal IRR 23%) (spot IRR 21%)
o C1 of US$1.52/lb copper (spot C1 US$1.39/lb) o 4.3-year payback period
* Scale and Opportunity – Stage One (11 years) lays the foundation for a 20 plus year operation and extracts around half of the current Ore Reserve. Substantial potential exists for Resource and Or Reserves growth, leading to mine life extension and higher processing rates beyond Stage One
* First Production – Annual payable metal of circa 42kt copper (Cu) and 30koz gold (Au) to follow ramp-up. First concentrate delivery timing Q4CY20255, to align with the beginning of the forecast global copper market deficit6
* Estimated pre-production capital cost of A$854M (US$598M) all-inclusive of full fleet, pre-strip and contingency
* Team – Board and Management have significant experience in delivering similar projects in Australia and internationally
* Contribution – Hillside to provide employment for over 500 people during construction and over 400 during operations (over $600M in payroll) and contributing over A$200M in state royalties
* Regulatory Approvals – Key approvals are in place to allow commencement of development and operations7
* Next Steps – Rex is actively seeking suitable funding via a structured process, to align with the detailed engineering, construction and operational readiness plans. Potential strategic partnerships via a minority interest are being discussed.
“Rex remains on track to become a significant Australian copper producer,” CEO and MD, Richard Laufmann, said.
“Despite the current global headwinds, the economics remain robust, and Hillside is planned to be in production at a time when the world will require a significant amount of copper to drive the global electrification initiatives.
“We have received strong interest from a range of external financiers, traditional and non- traditional lenders, equipment suppliers and the major copper smelters and metal trading companies.
“This is an exciting time for copper developers, for Rex Minerals, for shareholders, and for the South Australian (SA) and local communities which are poised to reap regional economic benefit from Hillside.”
Background
The 100%-owned Rex Minerals’ Hillside Copper-Gold Project on the Yorke Peninsula in SA is one of the most significant copper-gold development projects in Australia, and one of the biggest Ore Reserves in Australia, after Olympic Dam and Carrapateena – both also located in South Australia.
Hillside is fully permitted with key approvals in place. It has State Government and regional support, and in development will become a long-term major regional employer in SA while delivering significant regional economic benefit.
Based on Hillside’s 989kt Copper Ore Reserve:
* Stage One mine life of 11 years
* Stage One includes 151kt of copper-gold concentrate. The high-quality concentrate to contain annual payable metal after ramp-up of approximately 42kt of copper and 30koz of gold, average concentrate grade of 27%
* A subsequent Stage Two based upon current Ore Reserves and Mineral Resources8.
Mining operations to comprise conventional open pit extraction utilising large-scale rigid trucks loaded by excavator. A conventional flotation processing method has been chosen as the most technically and economically viable method for the separation of copper from the ore. Process tailings to be delivered to a dedicated Tailings Storage Facility. Concentrate to be trucked by road and subsequently shipped to market regularly from Port Adelaide.
For further information please visit: https://www.rexminerals.com.au/
