Following the lodgement of a mining lease (ML) application of its Orokolo Bay project in the Gulf, Mayur Resources Ltd says it is on its way to developing the first iron and industrial minerals project.
According to the firm, the application is about the full-scale development of the project with a planned saleable production rate of 0.5 million tonnes per annum (Mtpa) of vanadium titano-magnetite (VTM) and dense medium separation magnetite. This is also expected to produce 8,000 to 10,000tpa of a zircon rich heavy mineral concentrate and one Mtpa of high-grade silica construction material.
The Mineral Resources Authority (MRA) will now assess the application.
According to Mayur Resources Ltd managing director Paul Mulder, this was the final step of the project for it to be shovel ready.
“As Mayur’s second project to be advanced to final legislative approval in PNG, Orokolo is a simple, onshore, near-surface mining and processing operation with no requirement for grinding or chemical processing and a capital cost of only US$22 million (K77.19mil),” he said. “We, therefore, anticipate being able to work quickly with the MRA on this assessment. We’ve secured funding for the project which will not require further dilution and is exposed to an attractive forward-looking earning profile from next year.”
In the definitive feasibility study (DFS), the financial analyses used a pricing assumption for the VTM product founded on a cost of conservative long-term iron ore price of US$66.30/t (K231).
“This compares to a current iron ore price above US$150/t (K175), a major potential upside to the economics of the project,” he said. “In addition to the supportive iron pricing, and subsequent to the completion of the DFS, considerable work has also been undertaken and continues to be progressed to assess the suitability of the Orokolo Bay material to supply Singapore’s construction sector that imports huge amounts of this material. This potential opportunity is in addition to the supply of material to the Sydney market.”
He added that he was excited for the opportunity of establishing a mechanised sago harvesting operation post-mining.
“Our plan is to provide the community with sustainable employment and revenue opportunities that will continue well beyond the life of the mine, where sago production can serve both local demand and also be transported and sold in the larger Port Moresby market,” he said. “The MRA’s consideration of our application will occur in parallel with Orokolo’s pilot plant bulk sampling activities, for which the key plant and equipment is awaiting shipment into PNG. Construction of the pilot plant and the full-scale operation may overlap depending upon the timing of the mining lease approval process and the easing of the Covid-19 travel and transport restrictions into PNG.”
