construction, page-4

this is from the other week, but sums it all up nicely...

Moly Mines poised for construction at Spinifex Ridge
Friday , 25 Jul 2008


· On Track For Plant Commissioning Late Next Year And Production In Early 2010

· Company Working With Its Bankers To Secure Interim Funding Package

· Strong Moly Market Showing No Signs Of Weakness

"The Spinifex Ridge moly-copper project in Western Australia has now passed all permitting hurdles and is poised for commencement of construction", says Moly Mines Limited (ASX, TSX: MOL) in its end-June quarterly. "All major project development activities required to support the successful execution of a full funding package for the planned 20m tpa mine and processing facility have been completed", the company adds.

Subject to Moly Mines achieving full project financing during the second half of 2008, Spinifex Ridge is on track for plant commissioning late next year and production start-up in the first quarter of 2010. To this end, the company says it is working with its investment bankers, JP Morgan and Morgan Stanley, in order to secure an interim funding package that will form the first element of the total project financing package and allow the company to expedite delivery of the project in the third quarter of 2009. "Completion of this interim funding will also provide Moly Mines with the time and flexibility to optimise the full project financing programme".

Commenting on metal prices, Moly Mines says that, contrary to the performance of most other metals during the first half of 2008, the molybdenum market shows no sign of weakness. Moly oxide is currently trading at US$34/lb, continuing its strong performance of the past five years, the company adds.

Key project milestones achieved during the quarter include the doubling of resources at Spinifex Ridge to over 1bn tonnes of moly-copper mineralization, including measured and indicated resources of 652m tonnes. At the same time, ore/mineral reserves increased by 43p.c. to 451m tonnes, sufficient to support a 23-year mine-life at the planned initial mining/processing rate of 20m tpa.

Detailed mine plans for this first 23 years have been completed, although expansion studies are underway to boost annual throughput at Spinifex Ridge to approximately 33m tonnes in Year 5.

In April, WorleyParsons was awarded the EPCM contract for the project, with an estimated value of A$100m and, earlier this month, the Western Australian Environmental Minister gave his approval for Spinifex Ridge to proceed - the last major regulatory hurdle in the development of the project.

The other major development of note was the signing of a 10-year offtake agreement with ThyssenKrupp Metallurgie GmbH (TK Met) for 100p.c. of Moly Metals Australia's (owner of the project) share of molybdenum production from Spinifex Ridge. Moly concentrates from the mine will be shipped to Molymet's plant in Chile for conversion to molybdenum oxide and/or ferro-molybdenum under the tolling agreement that Moly Mines signed last December.

Cumulative project expenditure had reached A$133m by the end of the quarter, of which A$63.6m reports against the project capital cost control estimate. Moly Mines says that total capital commitments for Spinifex Ridge to date are A$274m, with another A$125m of equipment and construction packages awaiting approval and a further A$277m tendered. At least 70p.c. of the total project capital cost is expected to be contracted prior to completion of full project funding, the company adds.

ENCOURAGING RESULTS FROM DRILLING OF IRON MINERALISATION
Meanwhile, Moly Mines has commenced a 35-hole, 1,500m RC drilling programme on two areas of outcropping high-grade haematite mineralization to the west of the planned Spinifex Ridge open pit. Results from the two areas have been encouraging, states the company, with several wide intersections of potentially direct-shipping ore grading over 63p.c. Fe, as well as several intervals assaying between 50p.c. and 60p.c. Fe.

Whilst these results warrant further investigation, Moly Mines points out that the iron mineralisation is complementary to the huge moly-copper deposit at Spinifex Ridge which is the company's primary focus. Amongst other options, it is considering inviting expressions of interest from third parties to capitalise on the iron potential of the tenements, exploitation of which would be enhanced by the synergies of the nearby moly-copper mine and its infrastructure.