Ivanhoe Australia completed the feasibility study for its Merlin molybdenum and rhenium project in northwestern Queensland in mid-April 2012. “The feasibility study has largely confirmed the outcomes from the prefeasibility study, while improving the economics of the project,” Ivanhoe Australia CEO Peter Reeve said. “In addition, there is further potential upside to the study through options surrounding the plant’s roaster, which could be located outside of Australia for significant savings on up-front capital and operating costs.”
The processing plant for Merlin ore will be a new, separate mill and processing facility constructed at Ivanhoe Australia’s Osborne complex, 53 km from the Merlin mine site (E&MJ, April 2012, p. 20). The re-commissioned Osborne copper-gold mill became operational in March 2012, producing copper-gold concentrate, with throughput capacity of 2 million mt/y.
Initial capital expenditure to first production at Merlin is estimated at A$345 million. An additional A$52 million of capital in year one of operations is scheduled for an optimized molybdenum trioxide purification plant. This higher-grade molybdenum product receives a premium price and will increase overall returns to the project.
The Merlin mill at the Osborne complex will have a throughput rate of 500,000 mt/y. Production during the first seven years following ramp-up will average 5,100 mt/y of molybdenum as molybdenum trioxide and 7,300 kg/y of rhenium as ammonium perrhenate. Operating costs are estimated at approximately $6.66/lb of molybdenum, after byproduct credits and including royalties.
The Merlin feasibility study was based on a probable mineral reserve of 7.1 million mt grading 1.1% molybdenum and 18.1 g/mt rhenium.