Metro Mining sees major profit hike in doubling bauxite plans

Metro Mining released results of a Pre-feasibility Study showing considerable benefits in increased production under an Environment Impact Statement process.

Late last year the State Government requested Metro undertake an Environment Impact Statement - rather than the less onerous Environmental Approval process - for the Bauxite Hills Project. Bauxite Hills is 95 km north of Weipa on western Cape York.

Metro’s Pre-feasibility Study (PFS), released to the Australian Stock Exchange today, is based on bauxite production of 4 million tonnes per annum (Mtpa). The company had previously restricted proposed mining to 2 Mtpa.

Metro CEO Simon Finnis says increasing production required only minor changes to capital, operational and equipment requirements.

“Importantly, the environmental impact of the expanded project is not materially different to the smaller 2Mtpa scenario. The overall project footprint is unchanged with 24 hour mining operations and higher frequency of barge movements having little environmental impact,” Mr Finnis said.

“Increasing production also requires only a small increase in capital expenditure. The mining method and equipment fleet is of a similar size. Up front capital requirements have been kept to a minimum through the use of the initial low capital approach for 2Mtpa in the first 2 years of production before ramping up 4Mtpa from year three.

“Expanded production also delivers lower unit operating costs. Significant reductions in barging, transhipping and freight costs will be achieved,” Mr Finnis said.

The PFS confirms a 13 year mine life based on existing direct shipping ore (DSO) resources of 53.6Mt. There is a potential to extend mine life utilising 11.7Mt Indicated DSO bauxite resource at a nearby deposit, as well as from further exploration success.

“Given the extensive work Metro completed as part of its previous Environmental Approval submission and the prompt commencement of the EIS process last year we expect the EIS process to be completed by the end of this year. Mining is planned to commence in September 2017,” Mr Finnis said.