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Aguia: Bankable feasibility study values Brazilian phosphate project at US$212M

Brazilian fertilizer developer Aguia Resources Ltd. said March 20 that a bankable feasibility study for its Três Estradas phosphate project in Brazil estimated a posttax net present value of US$212 million, at a 5% discount rate, and internal rate of return of 18.3%.

Initial CapEx was pegged at US$83.9 million including US$8.3 million for contingency costs, with payback on the investment pegged at 6.2 years.

The mining plan envisages 43.5 million tonnes of run-of-mine ore mined through an open pit, truck and shovel operation over a 16-year mine life and potentially another 20 years of aglime production, which will be reclaimed from the tailings dam.

A phased development approach to the project is expected to reduce the project's initial capital needs while maximizing its economics, the company said.

In the first phase, which lasts 3.5 years, the project is estimated to produce an average 307,000 tonnes per year of phosphate rock concentrate.

After the saprolitic ore is depleted in the first phase, the plant will be expanded to handle carbonatite ore types and produce an aglime byproduct. In the second phase, lasting until the end of 16 years of operations, the study projected mining an average of 3.3 million tonnes per annum of run-of-mine, lower-grade carbonatite ore, with expansion of the processing plant to maintain production of 300,000 tonnes per year of phosphate rock concentrate and 2.8 mtpa of aglime.

The company anticipates recovering 1 mtpa of aglime from the tailings dam in the final phase.

The financial model used in the study was based on reserve estimates and assumes a long-term phosphate concentrate price of US$133/tonne and an aglime price of US$29/tonne.

The Três Estradas phosphate deposit hosts proven and probable reserves of 43.6 million tonnes grading 4.31% phosphorous pentoxide, according to the release.

The company noted that the development plan in the study will reduce the project's environmental footprint by 60% to 550 hectares.

The company retained Millcreek Mining to complete the independent engineering and resource studies on the project.