Perth, April 20, 2006 AEST (ABN Newswire) - Moly Mines Limited (ASX: MOL) is pleased to announce a major upgrade to the resource at the Spinifex Ridge Molybdenum/Copper Project, located in the Pilbara region of Western Australia.
The JORC compliant resource, estimate by SRK using a 0.03% Mo cut-off, is:
481 million tonnes @ 0.06% Mo and 0.09% Cu and includes:
- 61 million tonnes @ 0.08% Mo and 0.13% Cu Measured;
- 349 million tonnes @ 0.05% Mo and 0.08% Cu Indicated; and
- 71 million tonnes @ 0.05% Mo and 0.07% Cu Inferred.
Drilling will continue until June 2006 to provide sufficient Measured Resource to enable detailed mine planning and scheduling that will meet bankable criteria. The Spinifex Ridge initial pit will contain the majority of the Measured Resource.
In addition, PQ diamond drilling is ongoing which will provide the necessary core to complete the metallurgical testwork including a Pilot Plant program.
This new resource has been calculated by SRK Consulting (Australasia) Pty Ltd, using data from both historical diamond drilling and the major diamond and RC drilling campaigns carried out by the Company over the past 12 months.
The resource has been estimated using a database containing 102 holes for 35,318 metres. Data has been verified and twin holes were used to confirm the compatibility of historical data with newly acquired data.
Bankable Feasibility Study (BFS)
The Company is pleased to report that all key technical consultants have been appointed to undertake the BFS. The BFS is scheduled for completion by the fourth quarter 2006.
WorleyParsons have been appointed to manage the BFS process in addition to providing engineering design and ancillary services to the proposed 15 million tpa processing facility.
The scope of the BFS has broadened to include a separate but concurrent feasibility study on the merits of constructing a Roaster/Converter facility for the production of Molybdenum Oxide and Ferro-Molybdenum.
The Pre-Feasibility Study (PFS) has clearly demonstrated the justification for establishing a vertically integrated facility for the down-stream processing of the Molybdenum Concentrate produced at Spinifex Ridge, making available the deeper end-user market for Molybdenum Oxide and Ferro-Molybdenum finished product.
PFS Results
As previously reported, the highlights of the PFS were
- $633.4M NPV, 29.0 IRR pre-tax, ungeared using a 10% discount rate and life of model exchange rate of US$0.725
- US$3.30 cash operating cost per lb of Mo
- $223M per year EBITDA, averaged over first 10 years
- $622M estimated capital cost
Metal Prices used in the financial analysis
- Mo - US$12.50/lb
- Cu - US$1.10/lb
- Ag - US$5.75/oz
Operation to produce on average 21 million pounds of Mo Concentrate per annum (approx 9,000 tonnes contained Mo) and on average 19 million pounds of Cu Concentrate per annum (approx 8,000 tonnes of contained Cu) over 10 year life of study.
Initial discussions and negotiations continue with a number of potential off-take partners for the delivery of Molybdenum Oxide, Ferro-Molybdenum, Molybdenum Concentrate and Copper Concentrate.
Contact
Dr Derek Fisher
Managing Director
Moly Mines Limited
Telephone: +61 8 9388 5000
Fax: +61 8 9388 5099
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