BRITISH COLUMBIA - The outlook for Vancouver-based Stikine Energy's Nonda frac sand project just got brighter with a positive preliminary economic assessment. The project is located near the Horn River Basin, 190 km northwest of Fort Nelson.
Frac sand is essential to shale gas projects of which there are several in northeast British Columbia. Stikine believes its product will have an advantage being close to its customers rather than being shipped over long distances at considerable cost.
Assuming a frac sand sale price of $250/tonne, the PEA proposes a 25-year project that will pay for itself in 3.6 years after start-up. It will generate a net cash flow of $4.0 billion with a 25.9% internal rate of return. The pre-tax net present value is estimated to be $1.2 billion.
The Nonda deposit is a unique, says Stikine. It is a ..." homogeneous and continuous occurrence of fine-grained, slightly metamorphosed sandstone (quartz arenite). The sand grains are well-sized for frac sand products used in the Horn River Basin. The area identified for the inferred resource estimate (and PEA) is about 2.2 km long by 0.9 km wide and is located in the middle of the Nonda sandstone outcrop extending approximately 11.5 km in length. An inferred mineral resource of 702 million tonnes is based on bedrock mapping, core drilling, 3-D wire-frame modeling and volume estimates. Deductions used to account for potential overestimation were applied to give an adjusted inferred resource estimate of 625 million tonnes."
The flowsheet includes three-stages of dry crushing, then the crushed material is passed through a vertical shaft impactor. At this point, water is added and the slurry is fed to attrition scrubbers to liberate individual grains of sand. The grains are then sorted, dried and ready for shipment.
More information about Stikine's Horn River Basin project is available at www.StikineEnergy.com.
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