ASX-listed Venture Minerals has begun commissioning of the key wet screening plant at its former Riley iron ore mine in Tasmania as it edges closer to a full operational restart. The company says with plant construction completed and the commissioning phase underway, it remains on course to ship out the first iron ore from the rejuvenated project in the current quarter.
Perth-based Venture also plans to kick off mining activities and start test runs for ore haulage this week.
Venture Minerals Managing Director, Andrew Radonjic said: “Achieving this milestone of the installation schedule for the plant keeps the first iron ore shipment on track for this quarter. The recent record iron ore price makes it a perfect time for the company to transform from explorer to producer.”
Venture’s decision to revive Riley looks to be on the money, with the benchmark iron ore price for 62 per cent iron-content product having skyrocketed this year to a record high around $US210 per tonne.
The outlook for the iron ore price appears unlikely to change dramatically any time soon given the continuing COVID-19 restrictions besetting the world’s second largest iron ore exporter, Brazil.
Venture says insatiable demand for the steelmaking material from China, which has embarked on a new period of large-scale infrastructure investment, will also help underpin the stellar iron ore price.
In August 2019, the company tabled a pre-feasibility study on the redevelopment of Riley that used a spot iron ore price for 62 per cent iron of just US$90.35 per tonne.
The PFS estimates the initial planned two-year mining, crushing, screening and haulage operation can spit out $172.82 million in gross revenue and $37.64 million in EBITDA for a cash surplus of $30.67 million, based on the lower iron ore price.
Riley’s near-surface probable reserves, according to the 2019 PFS, stand at 1.6 million tonnes of ore at an average grade of 57 per cent iron.
Venture had a first crack at mining Riley seven years ago before weaker iron ore prices resulted in the company ceasing production in August 2014 and placing the project on care and maintenance.
How times have changed.
Launceston-based Shaw Contracting will carry out the mining and processing at Riley for Venture and national logistics outfit, Qube will truck Riley’s beneficiated iron ore product about 120km via sealed road to the Port of Burnie for export.
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