Anyone read the recent mining weekly interview with SAFM's CEO?
PERTH (miningweekly.com) − ASX-listed South American Ferro Metals (SAFM) plans to expand its Ponto Verde iron-ore operations, in Brazil, and would likely launch a feasibility study in the next few months.
CEO Philip Hopkins told Mining Weekly Online in an interview in Perth on Wednesday that SAFM was currently battening down the parameters of the feasibility study, and would likely have this completed by the end of October.
July was the start of the business year for us, and we are now a few months down the road. We are lucky to have pinned down a number of good executives and we have exceeded our production milestones. Now we will bring our feasibility study on this year, and it will come ahead of schedule by a number of months, Hopkins said.
The Ponto Verde iron-ore mine, which reached its full production capacity of 1.5-million tons a year at the beginning of the month, sells into the domestic market.
But Hopkins said that the expansion feasibility study would include rail and port options to sell its increased output into the international markets.
We currently sell around 1.5-million tons of ore at the mine gate, and that is manageable. But once you get to six-million or eight-million tons a year, the probability is that you will have to look to exporting,he said.
While it was still early days, Hopkins said SAFM would likely target the Asian markets as its export destination, but added that demand from the US was also starting to look up.
Meanwhile, SAFM was also looking at the possibility of a listing in New York, Toronto or London in its attempt to raise funds for both the expansion of the Ponto Verde project, and possible acquisitions down the road.
Whether we are talking about a merger and acquisition, or the [implementation of the] feasibility, either way you are talking about tens of millions of dollars. We dont have a treasury that deep, so we will need to go and raise funds.
Although there is a lot of money in Australia, and we have received lots of support, for the kind of funding level that we will need, the Australian market isnt heavily invested in Brazil as yet, and they may or may not have the appetite to pick that up, Hopkins said.
SAFM is also currently working to convert a section of its 148-million tons of resource into a Joint Ore Reserves Committee (Jorc) standard, which Hopkins said would support the basis of the feasibility study work.
The company was initially focusing on converting some 50-million tons of its resource into a Jorc standard.
We are doing the geological modeling and writing up the report, and we will complete that before the end of the calendar year. And that should be the basis whereby we do a feasibility study with credibility.
SFZ Price at posting:
24.5¢ Sentiment: None Disclosure: Held
