ASX-listed Venture Minerals is on the verge of shipping its first iron ore from its Riley mine in north-west Tasmania having chartered a bulk carrier vessel that will transport the ore in early September. The milestone achievement comes after the mine reached steady state production enabling enough ore to be generated for continuous haulage to the Port of Burnie for export.
A recently commissioned wet screening plant has allowed for 24-hour processing at the mine to reach steady state production and set the company on a transformational path from iron ore explorer to iron ore producer – a status coveted by many but achieved by few.
The bulk carrier, with a 46,000-tonne capacity, is scheduled to be loaded over four days prior to departing for the discharge port that will be nominated by Venture’s off-take partner, Prosperity Steel United Singapore, one of the world’s largest iron ore traders.
Venture recently activated a haulage and port agreement with major Australian logistics services provider, Qube, for delivery of ore to the Port of Burnie 120 kilometres away.
The company now plans to ramp up production to two monthly shipments.
The Riley deposit takes in 1.6 million tonnes going 57 per cent iron from surface. Mining of the hematite resource is planned over two years with 800,000 tonnes to be produced annually.
Venture Minerals Managing Director, Andrew Radonjic, said:"Through the now completed commissioning of the plant, Venture already has a significant stockpile of iron ore ready to ship. The achievement of steady state production and consequently continuous ore haulage has enabled the company to immediately charter a bulk carrier vessel to load and deliver the first shipment. This marks a major milestone for Venture as it transitions from a highly successful explorer to producer.”
Strong iron ore prices that are currently clocking in at about $US160 per tonne appear to bode well for the proposed two-year operation at Riley.
A 2019 Pre-feasibility study forecast the project to generate A$172.82 million in gross revenues and A$37.64 million in EBITDA for a cash surplus of A$30.67 million, assuming an iron ore price of just US$90.35 per tonne.
Cash operating costs were projected to average A$56.09 per before freight costs and A$85.12 per tonne when including shipping costs.
A bumper internal rate of return of 303 per cent after tax has been estimated in the study, aided by a remarkably low capital cost of A$6.7 million.
With Riley now in production, Venture is well positioned to generate cash-flow as the price of iron ore, whilst having taken a breather lately is still red hot. A cash injection from the operation would represent a welcome boost to Venture’s exploration efforts elsewhere.
The company recently launched a drilling campaign at its nearby Mount Lindsay tin-tungsten project which the company says is “globally significant”
The 148 square kilometre Mount Lindsay tenure already hosts one of the largest undeveloped tin deposits in the world with more than 80,000 tonnes of contained tin metal. The same mineralised body also contains a tungsten resource with 3.2 million metric tonne units of tungsten trioxide.
Venture has identified several high-grade targets for follow-up drill testing including the Big Wilson prospect where past drilling returned an impressive 17.4m at 2 per cent tin. At the Webbs Creek prospect, 8.5m at 0.4 per cent tin and 0.2 per cent tungsten was historically intercepted.
The price of tin is currently trading close to historical highs of about US$35,000 per tonne which represents exquisite timing for Venture Minerals.
With production at Riley and tin opportunities at Mount Lindsay and both commodities awash with positive market sentiment, Venture looks to be in the right minerals at the right time.
Is your ASX-listed company doing something interesting? Contact: matt.birney@businessnews.com.au
By Matt Birney
