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