A new economic study has found that a proposed new Northern Territory open-pit tungsten mine promises to deliver a net outcome of more than AU$100 million over its seven-year life, potentially expanding underground.


Thor’s Bonya tungsten outcrop

The mine would generate more than AU$500 million in revenue on known mining reserves and an Internal Rate of Return of 59 per cent, delivering its owners an early payback of under 18 months from first production.

The new economic findings announced today are from an enhanced Definitive Feasibility Study into the proposed AU$69 million Molyhil open-pit tungsten mine, 220kms northeast of Alice Springs.

Molyhil has an open-cut probable ore reserve of 3.5 million tonnes @ 0.29%WO₃ (tungsten) and 0.12% Mo (molybdenum) and is 100 per cent-owned by Adelaide-based Thor Mining.

The findings are a major boost for the project as tungsten is considered a strategic metal by the United States, China and the European Union and was confirmed this year by the US Department of the Interior as a ‘critical commodity’.

Prices for the commodity have also been on the rise since January 2016 and on today’s new report, and subject to final approvals and financing, could see first tungsten and molybdenum concentrate produced from Molyhil as early as 2020.

Tungsten’s unique properties include its high melting point, hardness and tensile strength. It has few substitutes and is used in the manufacture of hard metals, steels, alloys and mill products.

Thor Executive Chairman, Mick Billing, said today the enhanced attractive returns and early payback at Molyhil resulted from process improvements and longer operating life at the open-pit.

“There is further significant upside at Molyhil from expanding into potential underground mining and open-pit mining the nearby Bonya tungsten deposits, 30 kilometres east of Molyhil,” Mr Billing said.

“Strategically, the results of the enhanced DFS are based only on Molyhil’s known mining inventory and do not include the additional upside of either potentially going underground or mining Bonya.

“Molyhil will be a very low-cost tungsten producer on a global scale. The upgraded Net Present Value in excess of AU$100 million demonstrates the substantial value this project holds for the Company.”

Mr Billing said the new findings were the results of years of detailed work at Molyhil but provided further confidence in Thor’s ongoing engagement with third parties, which have expressed a specific interest in the project’s funding and offtake opportunities.

He described Molyhil as a ‘construction ready’ project.

“Subject to the submission of an acceptable Mining Management Plan once project level mine construction financing is confirmed, the 12-month mine construction schedule can commence.

“We are targeting first production by early in 2020,” Mr Billing said.

The project will operate as a fly-in fly-out operation.

Thor has already received environmental approval from the Northern Territory’s EPA for the project to proceed and also has agreements with traditional owners.

Mr Billing said the next steps for the Molyhil project would involve securing the balance of concentrate sales (off-take) agreements and financing project development.

“After that, it is planned to commence detailed engineering studies, along with completion of the Mine Management Plan and onsite civil works in preparation for mine and process plant construction and development.”

Thor has a non-binding Memorandum of Understanding (MOU) with Pennsylvania-based Global Tungsten & Powders for between 70 per cent and 75 per cent of Molyhil’s tungsten offtake.

The mine is anticipated to return an average feed grade after ore sorting of 0.48% WO₃ and 0.20 per cent Mo at a crushing and sorting rate of 531,000tpa to produce an annual production average of 125,000 mtu* or approximately 1.2 per cent of the current global market for tungsten. (* 1mtu = 10Kg of contained WO₃)

Resource Center Whitepapers, Videos, Case Studies