Wood Group appointed to execute PFS for the expedited development of the Longonjo NdPr Project
ASX Announcement 14 March 2019
Following the recent Mineral Resource upgrade Pensana Metals Limited (ASX:PM8) is pleased to announce that it has appointed the international engineering company Wood Group to execute a Preliminary Feasibility Study (PFS) for the expedited development of the Longonjo NdPr Project.
The study will focus on the delivery of a low capital cost open pit mining operation and exporting flotation concentrates to customers in China via the recently upgraded Benguela rail line and the Atlantic deep‐water port of Lobito.
Discussions with potential financiers have commenced and it is expected that a financing package will be finalised to coincide with the completion of the PFS (scheduled for September 2019).
The Company is of the view that given the work that has been completed to date and the relative simplicity of the operation, following the completion of a favourable PFS it should be possible to move immediately to Front End Engineering Design (FEED) and Engineering Procurement Construction Management (EPCM).
Pensana Metals, Chief Operating Officer Dave Hammond commented:
“The development concept is very straight forward. We are looking at a low capital cost, shallow open pit and flotation operation producing a high‐grade concentrate for export to China via the adjacent major rail and port infrastructure.
Last month’s substantially increased Mineral Resource estimate has enabled us to bring forward the PFS.
Our aim is to get into production and build our customer base at a time when EV and wind turbine manufacturers are driving the increasing demand for NdPr magnets for electric motors and Chinese rare earth processors are looking for additional low‐cost feedstock.”
Technical Report
Pensana have appointed international engineering company Wood Group to execute a Preliminary Feasibility Study to investigate an opportunity to fast track the Longonjo NdPr Project into production. Wood Group previously undertook the Scoping Study for Longonjo and have an experienced rare earth mining and development team.
The decision to expedite the development studies follows the completion of a large, high grade Mineral Resource estimate for the Company’s 84% owned Longonjo NdPr Project in Angola (ASX report, 19 February 2019).
The PFS base case for the initial development of Longonjo will consist of a shallow open pit mine and flotation plant on site.
The development will leverage off the advantage of the modern rail and port infrastructure already in place on the projects doorstep to ship a high‐grade flotation concentrate to customers China.
Longonjo development concept for Preliminary Feasibility Study
Above: Pensana has identified a practical path to early development that aims to position Longonjo as an important supplier of NdPr raw materials in time to meet looming demand from the electrification of vehicles
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Wood Group appointed to execute PFS for the expedited development of the Longonjo NdPr Project
ASX Announcement 12 March 2019
Following the recent Mineral Resource upgrade Pensana Metals Limited (ASX:PM8) is pleased to announce that it has appointed the international engineering company Wood Group to execute a Preliminary Feasibility Study (PFS) for the expedited development of the Longonjo NdPr Project.
The study will focus on the delivery of a low capital cost open pit mining operation treating 2 million tonnes a year and exporting 120,000 tonnes of flotation concentrates a year to customers in China via the recently upgraded Benguela rail line and the Atlantic deep‐water port of Lobito.
The Company is targeting a capital cost of the Project in the order of US$100 million.
Discussions with potential financiers have commenced and it is expected that a financing package will be finalised to coincide with the completion of the PFS (scheduled for September 2019).
The Company is of the view that given the work that has been completed to date and the relative simplicity of the operation, following the completion of a favourable PFS it should be possible to move immediately to Front End Engineering Design (FEED) and Engineering Procurement Construction Management (EPCM).
Summary
- The PFS will be based on the development of the high‐grade weathered zone mineralisation, which the company believes has potential to support over 10 years of mine life at an average mined grade of over 4% rare earth oxide and 0.85% NdPr, utilizing approximately 10% of the total Mineral Resource estimate. An infill drilling programme is under way to upgrade part of the Inferred Resource estimate to the Indicated category for the purpose of the study.
- The base case of the PFS has been increased from 1.5 to 2 million tonnes a year shallow open pit mining and flotation operation producing around 120,000 tonnes of high‐grade concentrate for export to customers in China via the recently upgraded Benguela rail line and the Atlantic port at Lobito.
- Hong Kong based commodity marketing consultants Conrad Partners has advised that the Company can expect to receive concentrate sale prices in excess of US$2,000 per tonne CIF China (based on the current US$45,000 per tonne NdPr oxide price).
- The PFS will utilise the flotation flowsheet developed during the previous Scoping Studies. (ASX Announcement Longonjo Magnet Metal Project Study Update RVY 6 December 2017). The Company is working with two established Chinese technical institutes, both highly experienced in rare earth processing, with a view to enhancing the flotation performance and high‐grade concentrate production.
- The Company is targeting a capital cost in the order of US$100 million. The Project benefits from the lack of a mining pre‐strip, a low strip ratio, a conventional flotation process plant, an adjacent water borefield, a nearby low cost hydro‐electric power supply, available labour and in particular excellent transport infrastructure.
- Subsequent studies will focus on an expansion of the 2 million tonnes per annum operation to treat additional NdPr mineralisation from the remaining 90% of this large deposit.
Pensana Metals, Chief Operating Officer Dave Hammond commented:
“The development concept is very straight forward. We are looking at a low capital cost, shallow open pit and flotation operation producing a high‐grade concentrate for export to China via the adjacent major rail and port infrastructure.
Last month’s substantially increased Mineral Resource estimate has enabled us to bring forward the PFS and increase the throughput from 1.5 to 2 million tonnes per year.
Our aim is to get into production and build our customer base at a time when EV and wind turbine manufacturers are driving the increasing demand for NdPr magnets for electric motors and Chinese rare earth processors are looking for additional low‐cost feedstock.”
Huge upgrade in Mineral Resource estimate sends Longonjo to the top of the world league
ASX Announcement 19 February 2019
Pensana Metals Ltd (ASX: PM8) is pleased to announce a very substantial upgrade to the Mineral Resource estimate for its Longonjo deposit which has transformed it into one of the world’s largest and highest grade NdPr deposits at a time when demand for NdPr in EV drivetrains is taking off.
Highly respected international mining industry consultants SRK Consulting has reported an Inferred Mineral Resource estimate of:
240 million tonnes at 1.60% REO including 0.35% NdPr for 3,850,000 tonnes of REO including 840,000 tonnes of NdPr *NdPr = neodymium+praseodymium oxide. REO = total rare earth oxides. A 0.1% NdPr cut is applied. Tables 1 to 3 summarise the estimate at a range of cut off grades, material types and total rare earth oxide grades.
This new Mineral Resource estimate represents a more than seven‐fold increase in tonnes and contains well over four times the amount of NdPr compared with the maiden Mineral Resource estimate reported to the ASX on 26 September 2017 at equivalent cut‐off grades.
The deposit occurs as a blanket of soft weathered material averaging around 30 metres in thickness and up to 75 metres in places. The highest grades occur from surface. The deposit remains open at depth and in a number of directions laterally. Further drilling is expected to increase the Mineral Resource estimate.
The initial focus will be on the resource occurring within a cut off around .65% NdPr which totals 22.9 million tonnes at 4.16% REO and .86% NdPr containing around 953,000 tonnes of REO including 197,000 tonnes of NdPr.
Executive Director Dave Hammond commented:
“Longonjo now ranks amongst the very largest and highest grade NdPr projects worldwide and is expected to get bigger at a time when China controls 96% of rare earth magnet production.
The demand for NdPr is set to take off as EV manufacturers invest over US$300 billion in what has been described as the biggest energy transformation in history. More than 75% of vehicle manufacturers are expected to use only electric powertrains by 2025.
It’s not just Longonjo’s high grade and sheer scale that gets us excited. It’s the fact that it’s located right next door to the Chinese‐built US$1.8 billion Benguela rail line which links the project with the Atlantic deep‐water port of Lobito and directly onto customers in China.
The earlier Scoping study by WOOD highlighted the benefits of the Chinese funded infrastructure, the high NdPr grade, low mining costs, good metallurgy and the available low‐cost hydro‐electric power.
We are now working with them to engineer and design a low capital cost flotation operation that can establish Pensana as a long‐term reliable supplier of high value NdPr concentrates to customers in China.”
Mr. Paul Atherley Chairman Mr. David Hammond Chief Operating Officer Mr. Mark Hohnen Non Executive Director Mr Neil MacLachlan Non Executive Director Mr. Scott Mison Company Secretary / Chief Financial Officer |
