Aquila upbeat on $4bn Pilbara project

06/05/2008 - 12:47

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South Perth based carbon steel producer and developer Aquila Resources Ltd hopes to start construction on its $4.13 billion ($US3.9 billion) West Pilbara iron ore project after reporting positive results at a pre-feasibility stage.

Aquila upbeat on $4bn Pilbara project

South Perth based carbon steel producer and developer Aquila Resources Ltd hopes to start construction on its $4.13 billion ($US3.9 billion) West Pilbara iron ore project after reporting positive results at a pre-feasibility stage.

The study has confirmed the technical and financial viability of the development based on a 25 million tonnes per annum iron ore operation.

Subject to approvals, the project could have its first shipments as early as 2012, with stage one construction earmarked for early 2010.

 

Full announcement below:

Carbon steel resources producer and developer, Aquila Resources Limited (ASX:AQA "Aquila" or "the Company") is pleased to announce positive results from the Pre-Feasibility Study (PFS) of the first stage of the West Pilbara Iron Ore Project ("the Project"), being developed by its 50% owned Australian Premium Iron Joint Venture ("API JV").

Mr Poli said, "Aquila began its iron ore initiative in 2004 and the completion of the PFS is a major milestone in its progression. The PFS has focused on the selection of preferred port options, development of the iron product, definition of infrastructure at proposed mine areas and development of mine-to-port transport corridors. The Company will propose that the API JV now proceed to a more definitive, bankable feasibility study."

"The Company remains committed to developing an iron ore export business in the West Pilbara through the API JV, and the results of the PFS are another significant step toward delivering this," he said.

The PFS has confirmed the technical and financial viability of a development based on a 25 million tonnes per annum ("Mtpa") iron ore operation, with 160km of new railway to a new open-access, deep-water port facility at Cape Preston, subject to commercial agreement with other parties with interests in this port. Sensitivity analyses indicate that the Project is capable of producing 30Mtpa in Stage 1 with a marginal increase in capital expenditure.

Subject to approvals, construction on Stage 1 of the Project could commence in early 2010 with first shipments in 2012. The pathway toward production outlined in the PFS includes the proposed submission of an Environmental Impact Assessment by the fourth quarter of 2008, with a Definitive Feasibility Study due to be completed in the second quarter of 2009.

Approximately US$1.7 billion of the estimated capital expenditure for the Project is incurred to install the railway, ore wharf and channel for such a facility. Significant opportunities exist to either minimise capital expenditure or maximise the utilisation of such infrastructure through joint development, third party use and increased throughput from the Project.

Mr Poli said, "The Company is highly encouraged by the recent announcement from Australasian Resources Limited ("ARL") that Mineralogy Pty Ltd, the developer of Cape Preston port, is prepared to consider a development proposal from ARL to construct a deep water port under Mineralogy's existing government approvals."

 

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