Peak Resources says its “BFS has been produced using a Tier One approach. We are also the only company outside of China that has used experienced rare earth industry operational and marketing executives to feed their expertise into a BFS back stopped by extensive pilot planting on the whole production process.”
The BFS consultants were led by Amec Foster Wheeler for Peak’s 75% owned Ngualla project. The study components consist of a mine and a multi-stage processing plant on-site at Ngualla in Tanzania and a rare earth refinery in the Tees Valley, UK.
Peak, together with its parters Appian Natural Resources Fund and International Finance Corp (IFC), is developing Ngualla to be a low cost next generation rare earth project with a product suite that is strongly aligned to the high value and expanding magnet metal market. Peak says that “with this distinctly different development approach backed by the advantages of a large high quality deposit, a bespoke metallurgical process and real world, rare earth experience, the company is well positioned for the predicted surge in demand for magnet metals from the electrification of automobiles and the green technology sectors.
The BFS is backed by extensive pilot plant test work, detailed engineering design and cost studies and a high confidence Mineral Resource estimate.
The focus of the study has been to evaluate the feasibility of the development of a long life open-pit mine and associated multistage processing plant on site at Ngualla in Tanzania. A base case of a subsequent rare earth refinery located in Tees Valley in the UK is presented to produce approximately 2,420 t/y of >99% purity neodymium-praseodymium oxide (NdPr), plus additional refined rare earth co-products.
Alternative marketing strategies being investigated by the company also include toll treating of the processed rare earth product from Ngualla at an existing refinery or direct sale of the product.
The production rate is based on the Ore Reserve released simultaneously with the BFS and is based on the 2016 Weathered bastnaesite zone Mineral Resource estimate at +1% rare earth oxide (REO) cutoff grade (ASX announcement Higher grade Ngualla Mineral Resource contains nearly 1 Mt rare earth oxide of February 22, 2016) and the mining, processing and economic assumptions contained in this report. 91% of the Mineral Resource estimate on which the Ore Reserve is based is classified in the Measured JORC category and 9% in the Indicated. No Inferred material is included in the Ore Reserve.
Managing Director, Darren Townsend, said: “This is a milestone reached only by a select few rare earth companies and is the culmination of many years of hard work.
“The Peak team has delivered on the one thing it can control – operating cost. We have further reduced our annual operating cost from $118 million per annum, as stated in the PFS dated March 2014, to $97 million per annum, in the project update dated March 2016 and now to $83 million per annum as set out in the BFS. This 30% or $35 million per annum reduction is outstanding and makes the Ngualla project one of the world’s lowest cost rare earth projects.
With an operating cost of $34.20/kg NdPr oxide this means if we were to equity finance the project we could produce in excess of $20 million per annum margin on the NdPr oxide product alone at today’s low spot prices.”