VHM’s Goschen mining licence clears path to development decision

The mining licence puts VHM on track for a final investment decision on the Goschen rare earths and mineral sands project this year.

Secondary approvals along with financing and offtake agreements are all that stand in the way of VHM making an FID for Goschen. Pic: Getty Images

• VHM awarded key mining licence for its Goschen rare earths and minerals sands project in Victoria

• Company to progress remaining secondary approvals, finalise financing and offtake agreements

• Final investment decision expected this year with first production targeted for late 2026

Special Report: VHM is another step closer towards pressing the go button on its flagship Goschen rare earths and mineral sands project in northwest Victoria after being awarded the mining licence.

This entitles the company to mine the land, explore for minerals and construct facilities related to the mining operation.

With the endorsed Environment Effects Statement under its belt, VHM Limited (ASX:VHM) is progressing all necessary remaining secondary approvals to construct, operate and close the project.

Goschen was recently awarded a three-year extension to its Major Project Status, which allows it to receive extra support from the Major Projects Facilitation Agency and benefit from a single entry point for government approvals.

“The approval of the Goschen Mining Licence is the latest significant milestone for VHM and further de-risks the project as we target a final investment decision,” chief executive officer Ron Douglas said.

“For shareholders of the company and potential financiers, this is a critical approval in the ongoing process of advancing Goschen through development and into production.

“Goschen has the potential to become an important Victorian supplier of critical minerals and we thank Resources Victoria for recognising the opportunity the Goschen project represents for the state.”

Goschen project

Goschen has an ore reserve of 210 million tonnes within a massive resource of 892Mt at 3% total heavy minerals that is also rich in rare earths.

It is envisioned as an initial 1.5Mtpa operation using a modular plant, expanding to 5Mtpa two years later.

Pre-production capital costs for stage one were forecast at $160 million and this stage is expected to produce 4300 tonnes per annum of rare earth mineral concentrate and 69,000tpa of zircon/titania heavy mineral concentrate at operating costs of $77 million per year.

VHM expects the initial stage to fund the stage two expansion to 5Mtpa. Capital costs for the expansion are $85-90 million, which will increase production to 9000tpa of rare earths and 134,000tpa of HMC for at least 19 years.

The combined project is estimated to provide a pre-tax net present value of $1.64 billion, an internal rate of return of 65% and a payback of 3.3 years, based on pricing assumptions from TZMI and Adamus Intelligence.

VHM is targeting to make a final investment decision on Goschen in 2025 to enable first production in late 2026.

It will also move to finalise investment discussions and develop strategic partnerships.

Listen: Ron Douglas chats with Barry FitzGerald

In a previous instalment of the Explorers Podcast, host Barry FitzGerald spoke with VHM (ASX:VHM) CEO Ron Douglas about the significance of the company’s Goschen rare earths and mineral sands project in Victoria.

This article was developed in collaboration with VHM Limited, a Stockhead advertiser at the time of publishing.

This article does not constitute financial product advice. You should consider obtaining independent advice before making any financial decisions.

Originally published as VHM’s Goschen mining licence clears path to development decision