New Century Resources (ASX:NCZ) reports the Prefeasibility Study (PFS) results for its Mt Lyell Copper Mine in Tasmania demonstrate ‘highly’ attractive economics for the restart of underground mining operations.
The ‘highly’ attractive economics will be achieved through potential development of a low-cost, long-life copper and gold operation in a Tier-1 jurisdiction supplied by 100% renewable power, and that the robust economic profile demonstrated includes a pre-tax net present value (NPV) of $560 million.
Other economics include an internal rate of return (IRR) of 22%, and an initial life of mine (LoM) of 25 years with a net cash flow of $1.081 billion. New Century adds the estimated pre-production capital investment requirement is $279 million, leveraging off existing infrastructure with a maximum cash draw of $360 million.
New Century reports average C1 costs of US$1.73 per pound copper are projected over the first 10 years of steady-state operations, and an average LoM C1 costs of US$1.89/lb Cu with the inclusion of the production ramp-up period.
Speaking on the PFS, New Century Resources Chief Executive Officer (CEO) and Managing Director Robert Cooper says the PFS provides a strong validation for adding this key growth opportunity to our portfolio.
“The study clearly demonstrates that Mt Lyell is one of the largest and most attractive near-term copper projects in Australia, with projected operational metrics that compare favourably to many current operations and a resource size that allows significant scale and mine life. Leveraging the extensive existing infrastructure both on and off site, Mt Lyell has an attractive capital efficiency and a low-risk development profile.
With an initial 25-year life of mine and an overall resource base greater than 1 million tonnes of copper and almost 1 million ounces of gold, this project is transformational for our company and represents a material long-term source of low-carbon copper to support the global transition to renewable energy and contribute to the decarbonisation of the economy.
“The study clearly demonstrates that Mt Lyell is one of the largest and most attractive near-term copper projects in Australia…”
The robust economics demonstrated in this PFS show that Mt Lyell can again be an integral part of the Tasmanian economy and boost employment in the West Coast region. Leveraging off the Tasmanian Government’s foresight to increase renewable energy generation in the State, Mt Lyell’s infrastructure and fixed assets are able to be 100% operated on zero carbon power.
In a world where the embedded carbon within supply chains is becoming increasingly important, this represents a significant competitive advantage. Reducing the carbon intensity of our production is a key target for New Century and Mt Lyell will help to deliver this outcome.
Building from our globally significant zinc production at the Century asset and the associated near-term Silver King development project, Mt Lyell represents a further opportunity for New Century to expand as a substantial Australian producer of base metals.”
The company also notes that about 555,000 tonnes of copper and 320,000 ounces of gold in concentrate is expected to be produced over the 25-year mine life. It expects an average annual production over the first 10 years post-ramp up of about 27,000 tonnes of copper and 16,000 ounces of gold, underpinned by an ore reserve containing 246,000 tonnes of copper and 198,000 ounces of gold.
New Century Resources adds that the first 10 years of mine life comprises about 82% of production from an indicated mineral resource, with an additional 8% inferred mineral resource drilling and pending conversion to indicated classification.
New Century Resources is an ASX-listed base metal producer established in 2017 with ‘significant’ assets and a brownfield copper development project. The company is currently working to restart copper production at the historically ‘significant’ Mt Lyell mine, which is located near the township of Queenstown on the West Coast of Tasmania.
Images: New Century Resources Ltd
