Ammaroo Phosphate Project, NT

Overview

The Ammaroo Phosphate Project is located 220km southeast of Tennant Creek. The project area contains the billion tonne 40km long Ammaroo Phosphate JORC Resource, the satellite Ammaroo South JORC Resource and the Rockhole phosphate prospect. A Bankable Feasibility Study and Environmental Impact Assessment (EIS) are currently underway with the Draft EIS is available for public comment from 30th October 2017 until 8th December 2017 by going directly to the EPA website http://www.ntepa.nt.gov.au/envirocomment.

 Ammaroo Titles

Tenement status as of 02 October 2017, showing granted ELs in green, ML applications in pink and all drilling including in areas now relinquished as black dots. JORC resources are outlined in purple and areas of independently estimated exploration potential are outlined in light blue. Proposed new infrastructure being evaluated in the BFS is shown in light green. The Rockhole prospect referred to below is labelled. The green tone background is pastoral lease and the yellow is Aboriginal land.

 Ammaroo Phosphate Resource

Table 1 shows that, relative to the December 2014 estimates, the Indicated Resource tonnage at 10% P2O5 cut-off has more than doubled with a corresponding 1% increase in P2O5 grade and an 18% decrease in potentially deleterious iron (Fe2O3).

 

December 2014

March 2017

Difference

Category

Mt

P2O5%

Fe2O3%

Mt

P2O5%

Fe2O3%

Mt

P2O5%

Fe2O3%

Measured

135

15.4

4.94

136

15.4

4.93

1%

0%

0%

Indicated

80

15.3

6.75

165

15.5

5.52

106%

1%

-18%

Meas + Ind

215

15.4

5.61

301

15.5

5.25

40%

1%

-6%

Inferred

930

14

6.6

840

13

6.9

-10%

-7%

5%

Total

1,145

14

6.4

1,141

14

6.5

0%

0%

2%

 

Table 1. Changes to the resource estimates at a 10% P2O5 cut-off since the December 2014 announcement. Figures are rounded and totals include rounding errors.

The lower iron material that may be the focus of initial production, (Indicated material reported at 10% P2O5 lower cut-off and excluding blocks with estimated Fe2O3 grades of greater than 5%), has approximately tripled(Table 2).

 

 

December 2014

March 2017

Difference

Category

Mt

P2O5%

Fe2O3%

Mt

P2O5%

Fe2O3%

Mt

P2O5%

Fe2O3%

Measured

89

16

2.34

90

16.0

2.33

1%

0%

0%

Indicated

33

15.9

2.77

90

16.2

2.38

173%

2%

-14%

Meas + Ind

122

16.0

2.46

180

16.1

2.36

4%

1%

-4%

Inferred

420

14

2.9

360

14

3.0

-14%

0%

3%

Total

542

14

2.8

540

15

2.8

0%

2%

0%

 Table 2. Comparison of current and December 2014 estimates at a lower 10% P2O5 cut-off and 5% upper Fe2O3 cut off. Figures are rounded and totals include rounding errors.

The Indicated Resource at a 15% P2O5 cut-off has also significantly increased (Table 3).

 

 

December 2014

March 2017

Difference

Category

Mt

P2O5%

Fe2O3%

Mt

P2O5%

Fe2O3%

Mt

P2O5%

Fe2O3%

Measured

60

18.4

4.11

61

18.5

4.12

2%

1%

0%

Indicated

38

18.1

6.68

72

19

5.23

89%

5%

-22%

Meas + Ind

98

18.3

5.11

133

18.8

4.72

36%

3%

-8%

Inferred

250

18

6

200

17

6.6

-20%

-6%

10%

Total

348

16

5.7

333

18

5.8

-4%

-2%

2%

 Table 3. Comparison of current and December 2014 estimates at 15% P2O5 cut-off. Figures are rounded and totals include rounding errors.

Mineralised domains and drillholes at the Ammaroo Phosphate Project. The blue arrows indicate where mineralisation is open at 10% P2O5. Model B with a 5% cut-off referred to in text is shown in yellow.

Ammaroo Resource

Measured, Indicated, Inferred Resources at 10% P2O5 cut-off and Exploration Target. The resources quoted have been trimmed to exclude cultural exclusion zones within, and defining the periphery of, the resource

 The Limestone Bore area includes approximately 4km of potential mineralised strike tested by a single traverse of 200m to 400m spaced RC holes. This area has insufficient drilling for estimation of Mineral Resources. Broadly spaced drilling in this area suggests the presence of an Exploration Target of around 50Mt to 100Mt at 8% to 10% P2O5 at a cut off grade of 5% P2O5, and 10 to 20Mt at 12% to 15% P2O5 at a cut off of 10% P2O5. These estimates are based on broad spaced drilling. The potential quantities and grades are conceptual in nature. There has been insufficient exploration to estimate a Mineral Resource and it is uncertain that future exploration will result in estimation of a Mineral Resource.

 Ammaroo South Resource

On 12 June 2014, a JORC 2012 Inferred phosphate resource, estimated at 70Mt at 13% P2O5 using a 10% cut-off, was announced for Ammaroo South on EL25185. This has not changed since.

Cut Off

P2O5%

Mt

P2O5%

Al2O3%

CaO%

Fe2O3%

K2O%

MgO%

MnO2%

Na2O%

SiO2%

TiO2%

U3O8 ppm

5

170

9.5

5.0

13

1.8

0.6

0.3

0.09

0.07

66

0.3

21

10

70

13

3.8

18

1.4

0.4

0.3

0.06

0.06

59

0.2

26

15

13

17

2.8

25

1.1

0.3

0.2

0.05

0.06

50

0.2

33

 Ammaroo South Inferred Resource.

In addition to the above, there are two areas of exploration potential adjacent to Ammaroo South, where broadly spaced drilling suggests the presence of an Exploration Target of around 200Mt to 400 Mt at 7% to 10% P2O5 at a cut off grade of 5% P2O5, and 50 to 100 Mt at 12% to 15% P2O5 at a cut off of 10% P2O5. This was reported to the market previously and in the previous annual report. The estimate has not changed since.

Updated Ammaroo Phosphate Pre-Feasibility Study

The initial Ammaroo Prefeasibility Study was completed and announced in September 2014. Completion of the preliminary feasibility study supported the economic and technical potential of the project to be developed as a phosphate rock concentrate export operation or for the production of phosphoric acid or the production of downstream ammonium phosphate fertilisers using proven technologies.

A reassessment and update of the Ammaroo preliminary feasibility study baseline economic evaluation was announced on 9 September 2015. The base case economic evaluations were reassessed to take into account long term forecasts of the Australian dollar's value that are considerably lower than previous forecasts, potential labour and other cost reductions in the Australian capital project and resource industry environment, reductions to forecast costs of diesel and gas associated with significant reductions in global prices for oil going forward and a reassessment of phosphate commodity pricing assumptions based on recent price evolution.

This revaluation has led to a significant uplift in the potential value of the Ammaroo Phosphate Project.

   

Case A – 2 Million tonnes per annum Phosphate Rock concentrate

Case B – 500,000 tonnes per annum Phosphoric Acid (100% P2O5)

Case C – 1,020,000 tonnes per annum Ammonium Phosphate Fertilisers

Indicative 50% Geared Post Tax NPV @ 8%

A$M

790

1,280

2,250

Geared Post Tax IRR

%

31

26

27

Indicative NPVs are after tax project NPVs and do not include corporate overheads

A$M: Millions of nominal Australian dollars

August 2015 project valuation summary for Ammaroo Phosphate Project.

The Ammaroo Phosphate Project remains a global-scale, very long life resource, positioned in proximity to existing transport and gas infrastructure and located in a stable OECD country. Currently the majority of the world’s seaborne traded phosphate originates from the Middle East and Northern Africa whereby the long term security of supply remains uncertain under a number of realistic scenarios. Australia currently imports approximately 80% of its phosphate requirements from countries such as Morocco, China, Saudi Arabia and the USA. The Ammaroo projects proximity to the Central Australian railway provides assess to markets in Asia through Darwin and to southern Australian agricultural users that are located in proximity to the southern railway terminus.

For further information regarding the completed pre-feasibility study please click HERE

 Di Ammonium Phosphate Fertiliser

Di Ammonium Phosphate Fertiliser Produced from Ammaroo Phosphate Project at Prayon's Laboratory in Belgium