Macarthur Minerals Ltd. revised its production strategy and cost estimates for the Moonshine magnetite and Ularring hematite projects in Western Australia, to align the developments with market conditions, capital markets and regional infrastructure availability.
The company said Dec. 13 said that it re-evaluated the two projects as a combined hematite and magnetite operation, with the bulk of the product to be high-grade magnetite concentrate supplemented by lump direct shipping ore.
Estimated operating costs for Ularring were reduced to A$41.91/t, shipped free on board, while capital expenditures for the combined project was reduced to US$335 million.
A 2012 pre-feasibility study on Ularring defined operating costs of A$78.14/t, while capex was pegged at A$262.7 million (US$363.7 million).
Operating costs for Moonshine were revised to A$55.36/t from a range of A$52.3/t to A$59.3/t, as estimated in a 2011 preliminary economic assessment, with capex estimates previously in the range of A$2.46 billion to A$2.91 billion.
Macarthur Minerals also reduced planned production to 3 million tonnes per year, in line with available capacity at the Port of Esperance.
The Moonshine PEA outlined production of 10 Mt/y of high-grade magnetite concentrate, while the Ularring pre-feasibility study targeted mining of 2 Mt/y of hematite/goethite iron ore.
A definitive feasibility study targeted for 2019 will include new reserves estimates and a full economic reassessment, the company said.
Macarthur Minerals hopes to leverage off existing infrastructure resulting from decreased iron ore production at the nearby Koolyanobbing mine, according to Executive Chairman Cameron McCall.
In August, Cleveland-Cliffs Inc. completed its exit from Australia with the sale of various assets to Mineral Resources Ltd. Production subsequently decreased, freeing up capacity on the Perth to Kalgoorlie rail line.