Alara Resources Limited

Published : April 01st, 2016

Feasibility Study Update

( 0 vote, 0/5 ) Print article
  Article Comments Comment this article Rating Follow Company  
0
Send
0
comment
Keywords :   Cash | Copper | Fixed | Georgia | Gold | Market | Oman | Recovery |

Feasibility Study Update

announcement - revised timetable


ASX/MEDIA RELEASE


31 March 2016


FEASIBILITY STUDY UPDATE

AL HADEETHA COPPER-GOLD PROJECT


Alara Resources Limited (ASX: AUQ) (Alara or Company) is pleased to announce positive preliminary findings of its Feasibility Study which concludes the Al Hadeetha Copper-Gold Project in Oman supports a financially viable project.


  1. Key Financials


    The Study findings conclude financial returns on Base Case as follows:


    • Revenue of AUD$ 586.5 million1 over 10 years


    • EBITDA over the same period of AUD$ 191.9 million2


    • Capital Expenditure (including contingency and working capital) of AUD$66.6 million


    • Free Cash flow (FCFF) of AUD$ 109.5 million


    • Project NPV of AUD$ 37.8 million


    • Project IRR of 21%


      The Base Case includes following assumptions:


    • Copper price has been conservatively based on the lower of two reputable price projections until 2019, ranging from US$ 5,190 to US$ 5,593 per tonne. Thereafter, the copper price is fixed at US$ 5,593 per tonne, which is the lowest price point forecasted at any time in the remaining period.


    • Gold price of US$ 1,200 per ounce. The current price of gold at the time of this report was US$ 1,265 per ounce.


    • Copper treatment charges of US$ 80 per tonne and refining charges of US 0.08c/lb with 96.5% payable.


    • Gold refining charges of US$ 5 per ounce with 90% payable.


    1 Based on exchange rate of AUD$1 to US$0.74

    2 Net of US$22 million in mining royalties


  2. Comparison of Market, Base & Low cases


    The assumptions used in the financial modelling produced a Base Case, Market Case and Low Case.


    The variable parameters in each case relate primarily to copper prices. The gold price and treatment charges are fixed entities in each case.


    A summary of financial returns for Base Case, Market Case and Low Case are summarised below.


    Table 1 Financial comparison between cases


    Case Scenario In US$ millions


    Total Revenue

    Opex (excludes royalty)

    EBITDA


    NPV


    IRR

    Market Case

    492

    270

    198

    52

    27%

    Base Case

    434

    270

    142

    28

    21%

    Low Case

    406

    270

    116

    13

    15%


    Copper price assumptions for the Market Case are based on the World Bank price projections to 2025 and flat thereafter.


    Copper price assumptions for the Low Case are a flat price of US$5,190/t, the projected copper price by World Bank for 2017.


    The Base Case financial model has taken the more conservative approach of using the lower of the World Bank and Economist Intelligence Unit projections until 2019, ranging from US$ 5,190 to US$ 5,593. Thereafter, the copper price is fixed at US$ 5,593, being well below the World Bank's 2025 forecast of US$ 7,000.


    In all cases, the gold price has been assumed at US$1,200 per ounce for the life of the Project. Likewise, a flat treatment charge has been assumed in all cases.


    TC / RC prices are not usually forecast. However, current market trends have been sourced from a substantial copper producer.


    The Base Case NPV is most sensitive to copper prices, followed by copper grade and recovery.


  3. Project Description & Key Parameters


The Project licences are held by Al Hadeetha Resources LLC, a 70/30 Joint Venture (the 'JV') between Alara Oman Operation Pty Ltd (a wholly owned subsidiary of Alara Resources Ltd) and Al Hadeetha Investment Services LLC (a privately owned Omani Company). Al Hadeetha Investment Services are associated with the well-known Al Naba group, owned by Sayyid Khalid Al Busaidi and his family. The JV was formed in 2011 for the purpose of exploring and developing the Washihi, Mullaq and Al Ajal copper and gold concessions and surrounding regions. Figure 1 shows locations of all Alara JV held exploration licenses in Oman.


Figure 1: Al Hadeetha Resources LLC Exploration Licenses in Oman



The Al Hadeetha Copper-Gold Project is currently based around the 'Washihi' copper-gold deposit.


The Washihi exploration licence covers an area of 39 sq km encompassing a 3 sq km mining licence application. A JORC compliant Mineral Resource estimate has been completed for Washihi. The license area and an application of a mining license within area shown in the figure below.


Figure 2: Washihi License Areas



Key Project parameters are summarised in Table 2 and following.


Table 2

FS Fundamentals

Pre-production Capex

(includes contingency & working capital)

$49.39 million

Mining method

Open pit, 10.3 years

Project construction

1 year

First production

Q3 CY 2017

Final production

2028

Processing rate

1 Mtpa

Average annual concentrate production

34,000 (wmt)

Total tonnes copper metal production

77,000 (t)

Total gold ounces

18,500 oz

Read the rest of the article at www.publicnow.com
Data and Statistics for these countries : Georgia | Oman | All
Gold and Silver Prices for these countries : Georgia | Oman | All

Alara Resources Limited

CODE : AUQ.AX
Follow and Invest
Add to watch list Add to your portfolio Add or edit a note
Add Alert Add to Watchlists Add to Portfolio Add Note
ProfileMarket
Indicators
VALUE :
Projects & res.
Press
releases
Annual
report
RISK :
Asset profile

Alara Resources LTD is based in Australia.

Alara Resources LTD is listed in Australia. Its market capitalisation is AU$ 30.4 millions as of today (US$ 21.9 millions, € 19.2 millions).

Its stock quote reached its highest recent level on January 14, 2011 at AU$ 0.48, and its lowest recent point on June 05, 2015 at AU$ 0.01.

Alara Resources LTD has 595 689 984 shares outstanding.

Your feedback is appreciated, please leave a comment or rate this article.
Rate : Average note :0 (0 vote) View Top rated
 
Project news of Alara Resources Limited
8/12/2016Project Updates
Corporate news of Alara Resources Limited
8/3/2016Closure of Renounceable Rights Issue
7/15/2016Dispatch of Prospectus
7/12/2016Letter to Ineligible Shareholders
7/8/2016Prospectus - Renounceable Issue
7/8/2016Letter to Optionholders - Renounceable Issue
7/8/2016Further Information & Project Update - Al Hadeetha Project
6/13/2016Further Information - Mineralisation at Al Hadeetha Project
6/8/2016Oman Project Update
5/31/2016Project Updates
5/19/2016Khnaiguiyah Zinc-Copper Project - Legal Update
5/11/2016Oman Project Update
4/13/2016Board Appointment and Appendix 3X
4/1/2016Feasibility Study Update
1/18/2016Option Expiry
12/23/2015Potential Breakthrough on Khnaiguiyah Project
12/18/2015Project Update - Oman
12/1/2015Results of Meeting
11/24/2015Recent Developments in Saudi Arabia
11/18/2015Listing Rule Compliance
Comments closed
 
Latest comment posted for this article
Be the first to comment
Add your comment
AUSTRALIA (AUQ.AX)
0.051+2.00%
AUSTRALIA
AU$ 0.051
08/11 11:32 -
2%
Prev close Open
0.050 0.055
Low High
0.051 0.055
Year l/h YTD var.
0.022 -  0.082 112.50%
52 week l/h 52 week var.
0.015 -  0.082 218.75%
Volume 1 month var.
81,620 -20.31%
24hGold TrendPower© : -31
Produces
Develops
Explores for
 
 
 
Analyse
Interactive chart Add to compare
Interactive
chart
Print Compare Export
You must be logged in to use the porfolio and watchlists (free)
Top Newsreleases
MOST READ
Annual variation
DateVariationHighLow
2022240.00%
2021-16.67%0.020.01
20205.88%0.030.01
2019-26.09%0.040.01
2018-23.33%0.030.02
 
5 years chart
 
3 months chart
 
3 months volume chart
 
 
Mining Company News
Plymouth Minerals LTDPLH.AX
Plymouth Minerals Intersects Further High Grade Potash in Drilling at Banio Potash Project - Plannin
AU$ 0.12-8.00%Trend Power :
Santos(Ngas-Oil)STO.AX
announces expected non-cash impairment
AU$ 7.02+0.86%Trend Power :
Oceana Gold(Au)OGC.AX
RELEASES NEW TECHNICAL REPORT FOR THE HAILE GOLD MINE
AU$ 2.44-1.21%Trend Power :
Western Areas NL(Au-Ni-Pl)WSA.AX
Advance Notice - Full Year Results Conference Call
AU$ 3.86+0.00%Trend Power :
Canadian Zinc(Ag-Au-Cu)CZN.TO
Reports Financial Results for Q2 and Provides Project Updates
CA$ 0.12+4.55%Trend Power :
Stornoway Diamond(Gems-Au-Ur)SWY.TO
Second Quarter Results
CA$ 0.02+100.00%Trend Power :
McEwen Mining(Cu-Le-Zn)MUX
TO ACQUIRE BLACK FOX FROM PRIMERO=C2=A0
US$ 3.58+2.29%Trend Power :
Rentech(Coal-Ngas)RTK
Rentech Announces Results for Second Quarter 2017
US$ 0.20-12.28%Trend Power :
KEFIKEFI.L
Reduced Funding Requirement
GBX 0.60+4.17%Trend Power :
Lupaka Gold Corp.LPK.V
Lupaka Gold Receives First Tranche Under Amended Invicta Financing Agreement
CA$ 0.02-25.00%Trend Power :
Imperial(Ag-Au-Cu)III.TO
Closes Bridge Loan Financing
CA$ 2.65-0.75%Trend Power :
Guyana Goldfields(Cu-Zn-Pa)GUY.TO
Reports Second Quarter 2017 Results and Maintains Production Guidance
CA$ 1.84+0.00%Trend Power :
Lundin Mining(Ag-Au-Cu)LUN.TO
d Share Capital and Voting Rights for Lundin Mining
CA$ 7.01+2.64%Trend Power :
Canarc Res.(Au)CCM.TO
Canarc Reports High Grade Gold in Surface Rock Samples at Fondaway Canyon, Nevada
CA$ 0.30+0.00%Trend Power :
Havilah(Cu-Le-Zn)HAV.AX
Q A April 2017 Quarterly Report
AU$ 0.28+0.00%Trend Power :
Uranium Res.(Ur)URRE
Commences Lithium Exploration Drilling at the Columbus Basin Project
US$ 6.80-2.86%Trend Power :
Platinum Group Metals(Au-Cu-Gems)PTM.TO
Platinum Group Metals Ltd. Operational and Strategic Process ...
CA$ 2.05-0.49%Trend Power :
Devon Energy(Ngas-Oil)DVN
Announces $340 Million of Non-Core Asset Sales
US$ 60.05+1.71%Trend Power :
Precision Drilling(Oil)PD-UN.TO
Announces 2017Second Quarter Financial Results
CA$ 8.66-0.35%Trend Power :
Terramin(Ag-Au-Cu)TZN.AX
2nd Quarter Report
AU$ 0.03+0.00%Trend Power :