Kalbar Resources wins $144m investment from Appian for Fingerboards mineral sands project

Unlisted Kalbar Resources has won $144m from US-based private equity firm Appian for its Fingerboards project in Victoria.

Unlisted Kalbar Resources has won $144m from London-based private equity firm Appian Capital Advisory as it pushes ahead with its mineral sands project in Victoria’s East Gippsland region.

Appian said it would invest $144m in Kalbar’s Fingerboards project, 20km northwest of Bairnsdale, as the company pushes through environmental studies on the former Rio Tinto project.

Kalbar has previously said it will cost more than $200m to bring the project to production, with the company planning to produce about eight million tonnes of heavy mineral concentrate over an initial 15-year mine life. The product will initially be exported as a concentrate, although Kalbar has previously talked of long-term plans to build a mineral separation plant when it kicks off mining at Fingerboards.

It is understood Appian’s investment will eventually give it a stake at the project level of up to 50 per cent if the plan comes to fruition, with the private equity company’s investment targeting the holding company which owns the tenements and project infrastructure.

Kalbar’s plans will also likely test the Victorian Labor government’s talk of becoming a more friendly jurisdiction for mining in the wake of the coronavirus’s hit to the economy, with the company likely to launch public consultation on its environmental effects statement within the coming weeks.

Assuming it wins environmental approval for the project, the company hopes to make a final investment decision over Fingerboards in early 2021.

Fingerboards was discovered by Rio Tinto’s exploration arm in 2004 and by 2008 was listed as one of the mining major’s most prospective discoveries, given the zircon-rich nature of the discovery and its proximity to established infrastructure in Victoria.

But the global financial crisis took a heavy toll on the mineral sands sector and Rio sold the project to Kalbar in 2013.

Fingerboards is one of a slew of mineral sands deposits under development in Victoria, with Iluka Resources running feasibility studies over its Wimmera project, and unlisted VHM Ltd also looking to develop its Goschen mineral sands and rare earths project in the north west of the state.

Appian Capital is the investment adviser to the private equity funds of Appian Natural Resources, which has about $US1bn under management. Last year Appian appointed former Mineral Deposits boss Robert Sennitt to head up its Sydney office as it looked to expand its presence in the Australian resources sector.