New Brunswick
Advanced tungsten - molybdenum - copper resources.
Message: sfield Promoted to HUB Leader and President
|
 |
|
|
When we last wrote about Canadian listed Geodex Minerals in May the company was on the point of completing the earn-out of a 70 per cent interest in the Sisson Brook tungsten/molybdenum project in New Brunswick from Champlain Resources. At that time its resource in the inferred category had increased five fold to 167 million tonnes grading 0.021% moly to give 77 million lbs of molybdenum, and 0.059% WO3 for 217 million lbs of tungsten. It therefore totalled 449 million lbs of tungsten equivalent and a preliminary economic assessment was underway. It is worth noting that this resource estimate was based solely on the southern half of Sisson Brook which was partially drilled by Texasgulf/Kidd Creek Mines between 1979 and 1982. Now the company has come out with a new resource estimate, again in the inferred category, which is bigger but still confined to the same area and because of the backlog in the assay labs it did not include results from about 75 per cent of the infill holes drilled in the preceding months. Nor did it reflect the high grade molybdenum assays reported in October from the recently discovered East Flank zone. Once all these are included, particularly the drill results from tungsten-copper zones 1 and 11, the resource estimate should bound ahead.The most important thing was the results from the preliminary economic assessment which were encouraging. Conservative prices of US$21.60/lb and US$8.00/lb were taken for molybdenum and tungten respectively and the assessment was based on an open pit mine operating at 20,000 tonnes/day. This would produce an average of 3.3 million lbs of molybdenum and 8.1 million lbs of tungsten a year to give a pre-tax internal rate of return of 29.8 per cent . This is the base case which accepts the SEC guidelines of a three year backward rolling average in metal prices with a further discount of 20 per cent thrown in and on this basis the pre-tax net present value is calculated at C$693 million. The initial capital cost has been estimated at C$353 million for a mine with a life of 31 years but this excludes working capital and environmental costs. Tungsten recovery is estimated at 70 per cent and molybdenum at 85 per cent and mineralogical studies to date as well as a short metallurgical test programme have not thrown up any problems. The actual process includes crushing, screening and grinding before primary sulphide conditioning and flotation. After flotation the molybdenum is cleaned and bagged and a gravity circuit is used to produce a tungsten concentrate. Fortunately the project has good infrastructure in the shape of roads, rail and a powergrid crossing the property and it is only 100 kms from Fredericton, the capital of New Brunswick, with some smaller towns and settlements even nearer. The port of Saint John is about the same distance away as Fredericton, but to the south. This preliminary assessment will now move forward to a pre-feasibility study and by that time the resource will be a lot bigger as a result of the drilling results from other zones being included. Clearly the president Jack Maris reckons his company is on a good thing as he has, very sensibly, acquired two new prospects near Sisson Brook and agreed to buy a controlling shareholding in its partner, Champlain Resources, a private company whose sole asset is a 30 per cent interest in Sissons Brook. The cash element of just over C$4 million was paid out of working capital, but Geodex took the opportunity to top up the kitty with a private placement of C$5 million. It should not be forgotten that the company is also considered to be the world's largest land holder of premium indium exploration properties due to the ownership of its second property, the rich Mount Pleasant camp also in New Brunswick. By premium indium is meant that it is of sufficient grade to support primary indium mining as indium is usually a by-product from zinc mining. The current focus may be on Sisson Brook, but Geodex could have two winners in its stable. Source: http://www.minesite.com/nc/minews/singlenews/article/geodex-announces-positive-economic-assessment-for-sisson-brook/41.html |
New Message
Please
login
to post a reply