Magnetite Mines Limited (ASX: MGT) has announced an update of its 100%-owned Razorback Iron Ore Project, located in the Braemar Iron Ore Province of South Australia.
The update incorporates the results of recently completed optimisation studies and is underpinned by a revised Ore Reserve estimate that includes the separately announced maiden Ore Reserve for the Iron Peak deposit.
Iron Peak is the highest-quality deposit within the Razorback Project and has delivered a significant positive impact on overall project economics, particularly in the critical first 10 years of operations.
- Razorback Project economics updated; reinforced by high-quality Iron Peak Ore Reserve
- Base Case 5Mtpa operation re-estimated to deliver:
- High-grade 20% mass recovery for first 10 years of operations
- Competitive US$46- $55 per tonne value-in-use operating cost (62% Fe equivalent)
- 91-year mine life
- Direct entry to emerging premium-price DR-grade pellet feed market
- US$1.0 – $1.3b pre-production capital requirement
- Improved economics support attractiveness to potential strategic partners
- Infrastructure de-risking advancing ahead of Definitive Feasibility Study and partnering
“We are positioning our 100%-owned, high-value and long-life Razorback Iron Ore Project to align with the transition occurring in the global iron and steelmaking sector. South Australia is fast emerging as a desired Tier 1 location for regional steel-producing nations to establish ‘green iron’ hubs based on proximity, existing infrastructure, stable regulatory environment, mandated 100%-renewable energy, emerging green hydrogen availability and abundant potential for high-grade magnetite concentrate production. Within this transition, Razorback is ideally positioned at the front of the pack of next-generation magnetite producers,” Magnetite Mines CEO Tim Dobson said.
“This project update combines the successful delivery of the optimisation study phase with the just announced maiden Ore Reserve for the high-quality Iron Peak deposit, which is now prioritised for production in the project plan and improves the first 10 years’ economics significantly. Our financial modelling has been deliberately conservative, incorporating adequate contingencies and acknowledging the recent inflationary cycle, while also reflecting emerging product price premiums for premium-grade iron ore products that are forecast to increase over the coming years as the global steel industry delivers on its urgent decarbonisation commitments.
“Our next steps are to de-risk the final elements of Razorback’s infrastructure requirements, which will allow us to complete a Definitive Feasibility Study and commence a partnering process aimed at sharing capital and marketing risk with quality partners to deliver the best possible outcome for Magnetite Mines shareholders.”