Aurox Resources Limited

Published : January 25th, 2008

MOVES TOWARD CONSTRUCTION AT BALLA BALLA - LUMP SUM CONTRACTS BEING FINALISED

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25 January 2008

 

 

ASX / Media Announcement

 

 

AUROX MOVES TOWARD CONSTRUCTION AT BALLA BALLA

LUMP SUM CONTRACTS BEING FINALISED 

 

Pilbara iron ore developer Aurox Resources Limited (“Aurox”) (ASX:AXO) is pleased to announce a major milestone in the development of its Balla Balla project south west of Port Hedland, upon reaching agreement with major engineering and manufacturing partners for the construction of its concentrate plant and associated port infrastructure.

 

Aurox has agreed to engage engineering and manufacturing giants FLSmidth Minerals Pty Ltd (“FLSmidth”) and Siemens Ltd (“Siemens”) to engineer, manufacture and supervise installation of all major components required to commission its six million tonne per annum Balla Balla magnetite processing plant and related port infrastructure.

 

A Letter of Award has been signed with FLSmidth with an initial payment of approximately $8 million to be made shortly to initiate detailed engineering work and secure key plant components.

 

Aurox Managing Director Charles Schaus said the lump sum contracts have been tendered by both groups, and provide for the scheduled first delivery of concentrate to Port Hedland Quarter 3, 2010.

 

“Securing lump sum contracts for the plant and port infrastructure is a huge milestone for Aurox and its shareholders,” he said.

 

“It moves Aurox a major step towards our goal of becoming WA’s first magnetite producer.”

 

“Having the lump sum contract mitigates the risk of cost blow-outs in the development of the project, and provides further security as we move into the construction phase.” Mr Schaus said.

 

Aurox has also signed a Letter of Intent with Siemens to engineer, manufacture and install all major electrical systems including gearless drives for the grinding mills. Firm price contracts are being drafted by both groups with execution expected in approximately 30 days.

 

FLSmidth and Siemens have worked together on numerous projects including the new crushing circuit recently installed at the Cloud Break operation owned by FMG.  Aurox is in advanced discussions with other contracting groups for the balance of plant including earthworks, slurry pipeline and Australian Standards supervision. 

 

“The Balla Balla processing plant will be constructed to handle additional capacity, reflecting the Company’s strategy medium term to ramp up production from our initial six million tonnes target,” Mr Schaus said.

 

The plant will incorporate a gyratory crusher and a SAG mill capable of 10 million tonnes per annum throughput in anticipation of the expansion from 6 million to 10 million tonnes per annum in 2014.  A second ball mill will be installed as part of the proposed expansion.

 

Scopeof Works Overview 

 

FLSmidth will supply the complete plant on a firm price basis beginning at the Primary Crusher Station at Balla Balla through to the slurry pipeline flange on site and from the pipeline output at Port Hedland to dewatering and transfer of the concentrate onto the ship loading conveyor.

 

On the basis of the Letter of Agreement and deposit FLSmidth are immediately proceeding with all steps necessary to complete the scope of the proposal which includes:

 

  1. Detailed engineering - specifications to be agreed and approved by Aurox.
  2. Equipment supply - crusher, mills, chutework, ducting, process piping, utility piping, etc.
  3. Structural steelwork - buildings, transfer houses, galleries, trestles, platforms, stairways, etc.
  4. Process automation and instruments
  5. Process guarantees
  6. Equipment warranties
  7. Delivery guarantees

 

FLSmidth will provide services to coordinate construction management, equipment installation, and plant commissioning.

 

Siemens will engineer, manufacture and install the Balla Balla electrical infrastructure as required for the processing plant which includes gearless mill drives. The Siemens scope also covers the electrics for the port handling facilities.

 

 

FLSmidth Profile

 

FLSmidth is a leading supplier of equipment and services to the global minerals industry with 8,500 employees worldwide.  FL Smidth recently celebrated their 125th anniversary and are listed on the Copenhagen Stock Exchange with a market capitalisation of approximately 3.5 billion euros.  

 

 

Siemens Ltd Profile

 

Siemens is a global powerhouse in electronics and electrical engineering, operating in the industrial, energy and healthcare sectors. For over 160 years, Siemens have been known for their technical achievements, innovation, quality and reliability.  A presence in more than 190 countries, positions Siemens as one of the most globally diversified businesses operating today.

 

 

AboutAurox and Balla Balla

 

Aurox Resources Limited (ASX: AXO) is a Perth based minerals group, with its most advanced asset the 100% owned Balla Balla magnetite project. The project is located near the coast south west of Port Hedland in the renowned Pilbara region of Western Australia.

 

Aurox is well advanced in the development of Balla Balla, having completed a Bankable Feasibility Study for six million tonnes of magnetite iron concentrate production annually. The Company has in place two 15 year sales contracts each for 3mtpa with major Chinese Steel Companies. The contracts provide for future expansion to 10 mtpa of concentrate sales. 

 

Balla Balla is based on a massive homogenous magnetite ore body currently being developed as one of the lowest cost magnetite operations in Australia. The project also has significant potential for titanium, production. Of tremendous benefit to the operation is its close proximity to major ports, gas reticulation, grid power and a main highway.

 

The new Balla Balla Bankable Feasibility Study demonstrates strong project economics with magnetite iron concentrate shipments to China scheduled to commence Q3 2010.

 

Visit: www.aurox.com.au

 

 

ASX Announcement – Aurox Resources Limited, 1/245 Churchill Ave, SUBIACO, WA 6008

Telephone 08 9382 4477, Fax 08 9382 2012  email contact: charles.schaus@aurox.com.au,  website:  www.aurox.com.au

 

 

Issued by

Purple Communications

Level 3, 28 Kings Park Road, WEST PERTH WA 6005

Ph: 08 9485 1254     Fax: 08 6263 0455

purple@purplecom.com.au    

 

 

 

Aurox Resources Limited

DEVELOPMENT STAGE
CODE : AXO.AX
ISIN : AU000000AXO6
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Aurox Res. is a gold and copper development stage company based in Australia.

Aurox Res. develops gold, copper, iron, titanium and vanadium in Australia.

Its main asset in development is BALLA BALLA in Australia and its main exploration properties are INDEE SOUTHWEST and YALGOO WADGINGARRA & CARLAMINDA in Australia.

Aurox Res. is listed in Australia and in Germany. Its market capitalisation is AU$ 143.1 millions as of today (US$ 145.4 millions, € 114.0 millions).

Its stock quote reached its highest recent level on July 20, 2007 at AU$ 1.55, and its lowest recent point on December 19, 2008 at AU$ 0.07.

Aurox Res. has 196 044 413 shares outstanding.

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AUSTRALIA (AXO.AX)BERLIN (DR4.BE)
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