Iluka Resources gives the go-ahead on a radical approach to a new mineral sands mine in NSW
Iluka Resources will go ahead with the $480m development on a novel new mineral sands and rare earth mine in NSW.
Iluka Resources has given the green light to a $480m development of a new mineral sands and rare earth mine in NSW, as the company seeks to secure the feed for its rare earth refinery in WA.
Iluka said on Tuesday it had finally given the go-ahead for its Balranald mineral sands mine in Riverina region of NSW – first approved for development in 2015 – and the company planned to trial a radical new mining method to exploit the underground deposit.
The Balranald deposit is more than 35km long, and a narrow 200m, but at 60m deep was considered too deep to economically develop using traditional open cut mining methods.
The company now plans to use a novel new process, which Iluka chief executive Tom O’Leary likens to “keyhole surgery”, to exploit the deposit.
While the exact process is a closely guarded secret, a presentation on Iluka’s website shows the system involves the use of an underground borer to drill through 10m widths of the ore body, before water is injected and sucked back through the drill hole to extract the ore and pump it to the processing plant.
Iluka says it is in the process of patenting the technology, and has previously said it could look to license the technology to other miners when Balranald was demonstrating its value.
Mr O’Leary said the approval of Balranald was a key step for Iluka, not only to expand its mineral sands production in Australia, but to provide feed for the rare earth refinery the company plans to build in Eneabba in WA.
First production is expected by early-2025 and, when fully ramped up, the mine will produce about 50,000 tonnes of zircon a year, plus 60,000 tonnes of rutile and 50,000 to 70,000 tonnes of synthetic rutile. Importantly, though, it will also produce about 4000 tonnes of a rare earth concentrate to be shipped to Eneabba to Iluka’s refinery.
Combined with Iluka’s plans to build another rare earth and mineral sands mine at its Wimmera project in western Victoria, Mr O’Leary said the company’s plans would provide feed that contained significant amounts of heavy rare earths, such as dysprosium and terbium.
Mr O’Leary said Iluka was still finalising the front-end engineering and design of the refinery, which would be funded by a $1.25bn loan from the federal government. The refinery is expected to enter production by 2025, with Iluka planning to produce about 17,500 tonnes a year of rare earth oxides from feedstock from its own sources, as well as from third parties, such as the Nick Curtis-led Northern Minerals, which has already inked an offtake deal with Iluka.
Iluka booked a $589m net profit for 2022, up from $366m the previous year. The company said its mineral sands operations delivered underlying earnings before interest, tax, depreciation and amortisation of $946m, up 45 per cent, despite a 21 per cent rise in unit cash production costs, to $938 a tonne of mineral sands productions.
Iluka shares closed down 7c to $10.63 on Tuesday.