Peak Resources Announces Updated PFS for Ngualla Project in Tanzania
Reduction in capital and operating costs
On March 16th Australia-based Peak Resources announced results of an updated Pre-Feasibility Study (“PFS”) for its Ngualla rare earth project in Tanzania.
The updated PFS sees a 10% reduction in pre-production capital costs to USD $330 million and an 18% reduction in annual operating costs to USD $97 million.
Shortened mine life to include only high-grade weathered zone
The mine life of the project has been reduced to 31 years from 58 years so as to only include production from the high-grade weathered bastnaesite zone – a zone that comprises just 22% of the Ngualla overall resource by contained TREO.
Average annual TREO production has been reduced from 10,062 tonnes to 6,720 tonnes owing to the elimination of a major proportion of deleterious cerium contained in ores during hydrometallurgical processing.
Consequently, the updated PFS sees unit production costs increase from approximately USD $12 per kilogram TREO to USD $16 per kilogram TREO, but this increase is more-than-offset by a higher basket value due to a reduction in the amount of low-value cerium oxide produced.
Plan to build and operate a rare earth separation plant in Europe
The updated PFS entails plans to build and operate a USD $95.6 million rare earth separation plant in Europe that will produce a mixed neodymium-praseodymium oxide, a mixed lanthanum-cerium carbonate, and a mixed samarium-europium-gadolinium-HREO carbonate.
Overall, the updated PFS reaffirms Ngualla’s place as one of the most economically-promising rare earth projects globally.
At conservative long-term forecasted rare earth prices, we believe the Ngualla project could payback its pre-production capital expenses in less than four years, and thereafter yield a 46% pre-tax operating profit margin.
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