Canadian Mining Journal

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PHOSPHATE STUDY: PFS for Lac-a-Paul project confirms $1-B NPV and 24% IRR

QUEBEC – Ressources d’Arianne of Saguenay, QC, has updated the pre-feasibility study for its Lac-a-Paul phosphate project, confirming that a 3 million t/y phosphate concentrate producer will generate an net present value (8%...



QUEBEC – Ressources d’Arianne of Saguenay, QC, has updated the pre-feasibility study for its Lac-a-Paul phosphate project, confirming that a 3 million t/y phosphate concentrate producer will generate an net present value (8% discount) of US$1 billion, a 23.7% internal rate of return and a 3.8-year capital payback on a pre-tax basis. The study is being completed by Met-Chem Canada.

The study looked into a 50,000-t/d mine and mill with average phosphate recovery of 90%. The proven and probable minerals reserves in the Paul and Maouane zones are 307 million tonnes with an average grade of 6.59% P2O5. Resources in the measured and indicated category are 348 million tonnes at 6.50% P2O5 and the inferred resource is 114 million tonnes at 5.46% P2O5. Annual production is to be 3 million t/y of 38$ P2O5 of low impurity apatite concentrate. Mine life will be 17 years.

The total initial capital expenditure is expected to be $795 million to develop an open pit producer. Cash operating costs are pegged at $80/tonne of concentrate, compared to an average price of $175/tonne FOB rail.

Arianne said the PFS did not include additional mineralization identified by core drilling since last fall, drilling that increased the strike length of the Paul zone to more than 2.5 km from 1.3 km. A new 43-101 estimate will be included in the feasibility study to be completed in 2013.

The Lac-a-Paul project is located 200 km north of Saguenay/Lac St. Jean. Learn more at Arianne-inc.com.