Sheffield Resources has awarded the engineering, procurement and construction (EPC) contract for the building of a 7.5 Mt/y mineral processing plant and associated facilities at its Thunderbird mineral sands project in Western Australia to GR Engineering Services.
The contract sum is around A$366.3 million ($264 million) with commencement of work subject to GR Engineering being issued with a full notice to proceed. This, in itself, is dependent on Sheffield satisfying remaining financing conditions ahead of a final investment decision being made to pursue the development of the project.
GR Engineering’s award comes after it was engaged as preferred tenderer in October 2017 to progress early works on the project. The company has substantially progressed detailed design and procurement activities during this time, GR Engineering said.
Delivery is scheduled to occur over approximately two years from the date of site mobilisation, which is anticipated in the June quarter of 2019, following the wet season.
GR Engineering’s scope of work under the contract extends to the engineering design, procurement, construction, commissioning and testing of all process and non-process infrastructure for the project, including a wet concentrate plant, mineral separation plant, low temperature roasting plant, administration buildings, bore fields and high voltage power distribution in addition to all civil scope items. It will also provide operations support for a six month term post-completion.
Sheffield also secured a A$240 million seven-year loan from Taurus Funds that will be used to reduce the miner’s operating costs by at least A$7.5 million every year over a 42-year life of mine, it announced. This means it has been able to accumulate A$335 million of loan facilities to enable the project to proceed.
Sheffield says its bankable feasibility study shows Thunderbird is a technically low risk, modest capital expenditure project positioned to generate strong cash margins from globally significant levels of production over a mine life of 42 years.
The company is targeting initial production in the December quarter of 2020.