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Highfield Completes Scoping Study for Sierra del Perdón Project in Spain
Apr. 21, 2015 09:52AM PST
Potash InvestingHighfield Resources Limited (ASX:HFR) announced that it has completed the scoping study for its Sierra del Perdón project in Spain, which showed its potential to be a long-life, high-margin project with low upfront capital costs to production.
Highfield Resources Limited (ASX:HFR) announced that it has completed the scoping study for the Sierra del Perdón project in Spain, which showed its potential to be a long-life, high-margin project with low upfront capital costs to production.
Highlights of the study include:
- Post tax, unlevered NPV10 of US$527 million
- Post tax, unlevered IRR of 38.5 percent
- EBITDA in first full year of production of US$120 million
- Initial 20-year mine life, significant upside with ongoing exploration
- Proposed mine is a decline accessed conventional, underground, room and pillar operation with flotation circuit processing
- Average yearly, steady state production of approximately 520k tonnes of granular K60 potash with cash operational expenditure in full production estimated at US$155/tonne (including transport costs to target markets)
- Independent expert spot potash prices discounted by 10 percent for contract pricing and sales and marketing fees delivering a 2017 FOB Vancouver standard product reference price of US$315 per tonne in real terms
- Capital cost estimated at US$233 million, inclusive of a 20 percent contingency
Anthony Hall, managing director at Highfield, commented:
The Scoping Study indicates that our Sierra del Perdón Potash Project is technically viable and has the ability to produce strong cash flows over a long mine life. The economic analysis suggests it is one of the best undeveloped potash projects globally. Sierra del Perdón is a fantastic second project for Highfield. While our focus remains firmly on the rapid development of our flagship Muga Potash Project, Sierra del Perdón´s Scoping Study demonstrates the robustness of our broader project pipeline which will be further enhanced by ongoing development work at our Vipasca and Pintano Projects. Importantly all projects are located in Spain´s potash producing Ebro Basin within close proximity to the Muga Project.
Click here to read the full Highfield Resources Limited (ASX:HFR) press release.