Tiberon pinning down costs at Nui Phao

Tiberon Minerals (TBR-T) reports that an interim feasibility study is positive, and points to a 16.6% internal rate of return, at its Nui Phao project, 80 km northwest of Hanoi, Vietnam.

The company has had independent consultants re-estimating the reserves and determining total development costs for Nui Phao.

The deposit is estimated to contain a proven and probable reserve of 53.1 million tonnes grading 0.214% tungsten, 8.34% fluorspar, 0.192% copper, 0.214 gram gold per tonne and 0.097% bismuth. In addition, there is an inferred resource of 27 million tonnes of similar grade.

The total capital cost (including a US$23.7 million-contingency) is pegged at US$211 million.

A major portion of direct costs (of US$143.8 million) is tied to two large expenditures: the process plant is by far the largest, with an estimated cost of US$65 million (a bismuth-recovery circuit has been added) and US$25 million has been allocated for compensation payments, as well as resettlement costs, to residents who live in the area of the development.

US$43.4 million is allocated to "indirect costs". These are costs, such as the cost of temporary buildings and construction, and labor employed for the construction, as well as initial inventory and taxes (which do not figure in the permanent budget).

Mineralization is hosted by a skarn, or greisen-mineralization, adjacent to a granitic intrusive complex, as well as by the granite itself.

Metallurgical mining consultants, SGS Lakefield Research, have indicated recoveries of 61% tungsten, 78% fluorspar, 29% bismuth, 87% copper and 13% gold.

The plan is to mine 10,000 tonnes per day, over a 16-year period. Total operating costs are estimated to be US$7.92 per tonne of ore. Assuming a debt to equity ratio of 75 to 25, the leveraged internal rate of return is estimated at 22.4% and the payback period would be 4.8 years.

A final feasibility study should be completed by the middle of this year.

An environmental impact assessment has been submitted to the Appraisal Council of the Vietnamese government; once approved, an application for a mining licence will be filed.

The Nui Phao property is held by the Nuiphaovica joint venture company, which is 77.5%-owned by Tiberon and 22.5% by two Vietnamese companies (Thai Nguyen Export-Import and Investment Company and Thai Nguyen Mineral Company).