BRITISH COLUMBIA – The pre-feasibility study is positive for the Carbon Creek metallurgical coal deposit in the Peace River district, says owner Cardero Resource Corp. of Vancouver. Using a base case coal price of US$175/tonne, the project has an internal rate of return of 23.7% and a net present value after-tax at an 8% discount of US$644 million.
The best part of the PEA may be the improved economic parameters compared to older studies. Pre-production capital has been reduced to US$217 million from US$301 million. The percentage of hard coking coal in the clean product will increase to 60% from 35%. The annual clean coal production rate will be boosted to 4.1 million tonnes rather than 2.9 million tonnes. Underpinning these numbers are increased measured and indicated resources of 468 million tonnes, up from 166 million tonnes. The proven and probable reserves are 121 million tonnes, enough to support 20 years of mine life. First coal production is planned for Q4 2014.
Initially, coal will be recovered from open pits in the North and Central areas. Underground mining is to begin in 2016 with a single continuous miner in the North area. By 2019, six continuous miners will be operating.
Detailed information and a photo gallery of the Carbon Creek project are available at Cardero.com.