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Platina Resources announces half yearly report

Mining News - Published on Fri, 15 Mar 2019

Image Source: steelguru.com
Platina Resources Limited present their report on the Company and its controlled entity for the half-year ended 31 December 2018.

During the period, the Company completed the Definitive Feasibility Study for the PSP located in central New South Wales, Australia. The DFS has confirmed the technical and financial viability of constructing a simple, low-strip ratio, open-cut mining operation and processing facility producing scandium oxide. The positive DFS demonstrates the opportunity to create substantial long-term sustainable shareholder value at a manageable capital cost.

Key highlights of the DFS include:
- Robust financials - The DFS demonstrates a very robust financial case. Based on a mine life of 30- years, the project generates an after-tax net present value in real terms (8% discount rate) of USD 166 million (AUD 234 million), post-tax IRR of 29% and payback period of 5.3 years. The financial model incorporates an average scandium oxide price of USD 1550 /kg over the life of the project. Based on market research and discussions with end-users, the Company believes this is the price necessary to drive wider-scale adoption of scandium in alloys;
- Low capital expenditure - The DFS is based on a processing plant designed to initially produce 20 t/y of scandium oxide at a capital cost of USD 48.1 million (AUD 67.8 million), expandable to 40 t/y of scandium oxide for a very low incremental capital cost of USD 11.7 million (AUD 15.6 million), as market demand for lightweight aluminium-scandium grows;
- High-grade, large resource base - The strength of the PSP is the very large and high-grade scandium resources, which are amenable to simple, low-cost, open-cut mining techniques at a low waste to ore ratio (1.9:1). The DFS assumes that 33% of the available Ore Reserves are mined over 30 years, and additional Ore Reserves and Mineral Resources could provide for decades of additional production or further production expansion;
- Conventional, well tested process route - Ore mined at Red Heart will be processed through a conventional high pressure acid leach circuit ("HPAL") to produce 99.99% high-purity scandium oxide. The process methodology has been extremely well tested through bench and pilot scale test work to confirm operating and capital estimates for the DFS;
- Access to infrastructure - The processing facility will utilise an existing industrial site in Condobolin. This unique site provides access to existing infrastructure - labour, water, power, rail, and sealed roads - which results in lower capital costs, and simplifies the permitting and approvals process;
- Potential for other revenue streams - Like other laterite projects using the HPAL process route, once all the minerals are in solution from the HPAL process, recovery is achievable at relatively low incremental cost, thus providing a potential future opportunity to generate cobalt, nickel, platinum and aluminium products (to make high purity alumina) and generate additional cash flow; and
- Significant community benefits - The Company is very committed to delivering the PSP in an environmentally and socially responsible manner. The significant investment will provide jobs, training and contracts for the local communities.

Following the release of the PSP DFS, an updated Ore Reserve statement was prepared and is outlined . Full details of the Ore Reserve upgrade are outlined in ASX release titled "Platina Scandium Project Ore Reserve Increase", 13 December 2018. The DFS assumes that 33% of the available Ore Reserves are mined over 30 years, and additional Ore Reserves and Mineral Resources could provide for decades of additional production or further production expansion.

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Posted By : Rabi Wangkhem on Fri, 15 Mar 2019
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