Mine is set to re-open
MELIOR Resources has announced it intends to restart operations at the Goondicum ilmenite mine located near Monto.
The company has secured an agreement in principle with Pala Investments for the provision of a $US5.25million "restart loan” which will assist with the re-opening of the mine.
With this commitment from Pala in place, the company needs $US5million to fully begin the restart of the Goondicum ilmenite mine.
Melior Resources chief executive officer Mark McCauley said the company planned to have funding finalised by Christmas.
After that, he predicted it would be roughly six months' worth of construction and improvements.
"We're installing some additional equipment to improve recoveries and overall product quality,” Mr McCauley said.
Goondicum was placed on care and maintenance in July 2015 due to weak ilmenite prices.
Mr McCauley said the company wanted to make sure that, unlike previous times when the mine had opened only to close again, they would have a plan to make it sustainable in the long-term.
"We are doing things to the products to include their quality so we can offer better products during the inevitable downturn of the commodity cycle,” he said.
"We've got a current mine plan of around nine years but I think, if we're still operating in nine years, it's almost certain we'll still be open in 14 or 15 because there's a lot of additional tonneage we don't have factored in to our current plan.”
Melior's decision to restart operations at Goondicum is based on factors including strong project economics, recovery of ilmenite prices and a positive outlook for the sector given expected GDP economic growth in China.
Mr McCauley said the mine would employ about 50 people.
"Most of the employees will come from either the Monto region, or not too much further afield,” he said.
"The main thing is the employment and the supplies are being sourced locally and we won't open this mine unless we're confident it's a long-term proposition.”