Dynasty Metals Australia: Scoping Study shows Pilbara iron project economically viable Thursday, December 15, 2011 by Angela Kean
Dynasty Metals Australia (ASX: DMA) has confirmed the technical and commercial viability of its Spearhole Detrital Iron Project in the Pilbara in a recent Scoping Study which highlights the project’s potential to return profits exceeding $2 billion assuming a long term $100-110 per ton CNF price once in production.
The Scoping Study is based on a plant producing 5.25 million tonnes per annum for a mine life of 25 years based on the current Inferred Resources of 932 million tonnes at 27% iron, with beneficiation studies showing the project is capable of producing 120-167 million tonnes of iron concentrates.
Conceptual high level estimates for mining and transport costs indicate free on board operating expenditure of $59.25 per tonne at a 15% yield based on the current spot price for 61% iron in China of US$139 per tonne.
Importantly, there is the potential for more positive economics for ramping up to a 10 million tonne per annum operation.
Another positive for the Spearhole Detrital Iron Project is that an increase in yield will reduce beneficiation and mining costs, with an increase in yield of just 1% returning a cost reduction of 6%.
Dynasty is planning further field work next quarter to improve the yield and increase the iron grade.
The Scoping Study does not include the direct shipping ore (DSO) Resource at the Marra Mamba prospect. Dynasty is continuing exploration in the area targeting DSO Resources to increase the global iron Resource of the Spearhole Detrital Iron Project.
DMA Price at posting:
16.0¢ Sentiment: Hold Disclosure: Held
