Revolver Resources has outlined a strong case to restart its Dianne copper mine in Queensland, following the completion of a detailed recommencement study and site-specific engineering designs.
The study builds a strong business case for restarting the copper mine, with a forecast pre-tax free cashflow of over AU$125 million.
The study took into account low capital expenditure, short project duration and utilisation of proven copper processing technology.
At an assumed copper price of US$10,500 per tonne, the project delivers a pre-tax net present value of AU$69 million – an internal rate of return of 35 per cent. The study estimates capital expenditure to restart production at AU$19.7 million with payback after 12 months.
Revolver Managing Director Pat Williams said: “The detailed results from the study clearly illustrate the potential of a high value, short duration operating project with the potential to generate a material level of free cashflow that could be used to fund significant ongoing growth initiatives for the company.
“The comprehensive range of technical and engineering works program completed, and results achieved, provide a confident foundation to conclude targeted funding arrangements for the project and commence construction activities.”
The study assumes that the open pit will be mined over three years in a single stage at an average strip ratio of 1.4 to 1 to produce a total of approximately 1.65 million tonnes of ore feed to the heap leach pad at an average grade of 1.05 per cent copper.
The study also assumes that the heap leach SX/EW facility will operate for four years and produce approximately 14,330 tonnes of copper cathode.
The copper cathode would be trucked to the Port of Townsville, before shipping to domestic and international markets.
The Dianne copper mine benefits from being located within granted mining leases, with existing infrastructure already in place.
The project will be a small-scale operation with mining completed within a three-year timeframe.
Revolver has designed a low capital start-up, and at maximum capacity utilise a workforce of up to 35 personnel.