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Amex Resources Limited’s bankable feasibility study for the Mba Delta ironsand project has confirmed the viability of the dredging operation over its planned 20-year life.
The Australian mining company was earlier this year granted a 21-year mining lease to extract ironsands from the Ba River delta.
Managing director, Matthew Collard, told Sun Business the feasibility study sets out the plan for project implementation and civil works at their Lautoka port site.
Works at the port are scheduled to be completed by the end of October 2013 and will incorporate the construction of a new wharf, storage shed and offices plus the delivery of all the marine fleet for the operation.
Mr Collard said the construction of a sealed access road and perimeter fence are nearing completion.
Supply deals to China
Mr Collard also confirmed that earlier in August, they signed several memorandums of understanding (MOUs) for the supply of ironsand concentrate products to China.
“The first MOU was agreed with one of China’s major steel mills and is for two-thirds of our planned initial product of 750,000 tonnes annually,” he said.
“The second is for an additional 120,000 tonnes each year.
“Amex Resources is in advanced negotiations with other steel mills through its executive director of marketing, Yibo Qiu.
“Funding negotiations are also well advanced.”
Mr Collard said further studies were underway by a well-regarded Suva environmental specialist, to ensure that construction activities at the port and logistics base sites would be carried out with minimum disturbance.
“It will also ensure that it is fully within the requirements of the relevant authorities, even though the necessary approvals were received from the Department of Environment in December 2011.”
Mr Collard said liaison with local community groups was also ongoing, from their regional base in Sorokoba within the project area.
“In preparation for the main phase of wharf and infrastructure construction, a programme of geotechnical investigations to confirm the ground conditions at the site has been successfully completed,” he said.
“Detailed planning and design works have also been advanced following completion of the bankable feasibility study.
“The company anticipates placing orders for construction of the dredge, process plant and other long-lead time items over the coming months so that it can remain on schedule for the planned start-up in October 2013.
“Our chief operating officer, Bob Mansfield, is currently dividing his time between Fiji and Perth (Australia) head office to accelerate this process and looks forward to relocating full-time to Viti Levu in the near future.”
Negotiating challenges In terms of challenges, Mr Collard said Amex Resources have extensive relevant experience which they believed would allow them to identify and minimise the challenges to this mainly marine-based operation.
“Although dredging has been carried out at the Ba River mouth over many years by the Government, extraction of the magnetite-rich ironsands will be a new process for Fiji,” he said.
“Our ironsands expert, Dr Chris Ure, has many years’ experience with a similar project in New Zealand and his knowledge is very important.
“However, changes in prices for iron ore, fuel and currency exchange rates are outside of the company’s control but can be considered a potential challenge.”
Mr Collard said this would be minimised by keeping their operating costs low, to those levels reported in the bankable feasibility study.
Amex Resources has over the last three and a half years spent just under $10 million in exploration and project development.
The company anticipates capital investment of $150 million which will be completed by the end of 2013.