Iron Hill is located 3 kilometres south of Mount Gibson’s recently depleted Extension Hill open pit.
This close proximity enables the utilisation of Extension Hill’s substantial existing workshops, processing facilities, camp and transport infrastructure, as well as the workforce.
As a result, negligible capital is required to be spent, and the first product sales are targeted to commence in May 2017.
Iron Hill has a total resource of 8.8 million tonnes at 58.3% iron.
Life-of-mine site cash costs are anticipated to be similar to operations at Extension Hill at circa $46-48 per wet metric tonne (wmt).
Mount Gibson is targeting Iron Hill to contribute product sales of about 400,000 to 500,000 wmt in FY2016-17.
Significantly, total life-of-mine product sales of 5.5-6.0 million wmt are expected from Iron Hill through to late 2018 when production is expected to be complete.
Mount Gibson has already entered into offtake agreements with respect to circa 70% of the first year’s planned production from Iron Hill.
Gaining the final approvals required for Iron Hill is the culmination of a significant effort put in by the company’s permitting team since the initial application was made over two years ago.
Mount Gibson will now look to rapidly develop this high value, low-capital production opportunity, thereby extending the life of the company’s mid-west business.
The company’s cash, term deposits and tradeable investments swelled to $447 million as at 31 December 2016, up from $437 million as at 30 September 2016.