King Island Scheelite Ltd.'s feasibility study for its Dolphin open cut tungsten project in Tasmania, Australia, outlined a pretax net present value, discounted at 8%, of A$146 million, a 47% internal rate of return and a 2.75-year payback period.
The net present value is slightly lower than the A$153 million estimate in the economic analysis for Dolphin released in May.
The feasibility study estimated mining and processing of about 400,000 tonnes per annum of ore for eight years to produce about 3,500 tonnes of tungsten trioxide concentrate per year.
Total capital costs for the project were estimated at A$65 million, with operating costs of A$129 per tonne of tungsten trioxide produced.
The mine and processing plant are estimated to achieve commissioning within 15 months of financial close, expected in the second half, which will make first shipment possible within the first quarter of 2021.
The company said June 3 it is currently exploring possible joint venture partnerships and is in discussions with suppliers and financial institutions for project funding.
"The impressive indicative economics reiterate that we have chosen to develop the right project with the right commodity in the right place and time," Chairman Johann Jacobs said.
The Dolphin project hosts JORC 2012-compliant probable reserves of 3.0 million tonnes at a grade of 0.73% tungsten trioxide, at a 0.2% cut‐off.
King Island signed an off-take agreement in April to supply 1,400 tonnes of tungsten trioxide over four years to Sandvik AB unit Wolfram Bergbau und Hütten AG.