In a quarterly results statement, Australia’s Metals X announced the results of a feasibility study into the treatment of old tailings from the Renison mine in Tasmania and said that it would be looking at “alternative scales and development concepts” to make the project viable. Metals X is currently in the process of divesting 50% plus of its Tasmanian tin assets to China’s Yunnan Tin Group. In the June quarter the company produced 1,361 tonnes of tin-in-concentrate, down slightly on the 1,439 tonnes produced in the March quarter. The dip was due to two disruptions to operations due to a train derailment and power supply disruptions. However the unit generated positive cash flow of A$3.7 million in the latest quarter and continues to build up production towards targeted levels of over 6,000 tpy.
The Rentails feasibility study shows potential additional annual production of some 5,300 tpy of contained tin and 2,000 tpy of copper, at an operating cost of under US$9,200/tonne of tin after copper by-product credits. However substantial capital costs of A$194 million (US$155 million) result in an internal rate of return of just 8%. In its statement the company said:
“The current uncertainty in world financial markets and the resultant metal market suggest that whilst the Rentails Project is a large project with positive economic outcomes, its current magnitude of capital and operating cost, coupled with the current volatility of tin prices and exchange rates are such that the Board of Metals X believes the project will be difficult to finance in the current environment……Metals X intends to now investigate alternative scales and development concepts which it believes can reduce the capital and operating costs compared to this benchmark feasibility study. In addition, Metals X will continue to review options for funding the project development as the project economics improve with the global economy.”
