YUKON – The preliminary economic assessment of the Northern Dancer tungsten-molybdenum project owned by Largo Resources of Toronto outlines the potential for low cost open pit production. The project straddles the Yukon-British Columbia border 290 km east-southeast of Whitehorse.
According to the PEA, pre-production capital costs will be US$645 million, including a 25% contingency. Sustaining costs will be US$225 million. The project has an unleveraged IRR of 20% on a pre-tax basis. The pre-tax NPV at an 8% discount rate is US$ 918 million. Cumulative cash flow is US$4.82 billion. These projections are based on metal prices of US$275 per tonne for tungsten in the form of ammonium paratungstate (APT) and US$17.50 for molybdenum.
The Northern Dancer process plant will treat 30,800 t/d of feed materials through the crushing and sorting circuits. The resulting sorter concentrate, 65% of the run-of-mine feed mass, will be processed through the grinding and molybdenum/tungsten recovery circuits at a rate 20,000 t/d. Medium grade flotation concentrate is converted to APT in-house.
Overall metal recoveries into concentrates are estimated at 75% for tungsten and 72% for molybdenum. The predicted APT conversion recovery is at 95% of tungsten concentrate.
The cash costs are estimated at US$116 per tonne of WO3Eq product. During the 23-year mine life, there will be sufficient lower grade material stockpiled to run the process plant for another 26 years once mining has stopped. Overall recoveries during processing and milling provide for recoveries of 75% for tungsten and 72% for molybdenum based on metallurgical tests completed to date. The selected process route provides for the use of sorting using dual energy x-ray transmission (DE-XRT). The PEA currently envisages the production of APT on site. Molybdenum processing costs include an 8% assessment for offsite costs and roasting to produce a saleable concentrate.
Largo also operates the advanced exploration Maracas property in Brazil. Information on both projects can be found at www.LargoResources.com.