AKORA Resources Ltd is moving along the path toward developing a direct shipping ore (DSO) start-up operation at its high-grade Bekisopa Iron Ore Project in Madagascar and is set to begin a pre-feasibility study (PFS) following last month’s encouraging scoping study.
The scoping study indicated that Bekisopa could produce up to 2 million tonnes per annum of high-grade lump and fines products at an average 61% iron grade over the first five years.
“A great deal has been achieved over the last three years with November’s scoping study confirming AKORA is well positioned to deliver higher value, lower impurity iron ore products for making lower CO2 emissions greener steel,” said managing director and CEO Paul Bibby.
“Advancing to the PFS phase is another major step towards developing an iron ore DSO operation at Bekisopa.”
A low-cost operation
The follow-up PFS, to be undertaken by Wardell Armstrong International, will focus on a low capex option that utilises the project’s DSO JORC indicated resource of 4.4 million tonnes hosted in the project’s southern zone.
This southern zone resource comes from just 20% of Bekisopa’s 6 kilometres of strike length and it is anticipated that with further drilling, the PFS will include an expanded resource and production profile.
The scoping study found that Bekisopa could deliver an estimated initial five-year revenue of US$545 million and generate pre-tax operating cash flow of US$270 million, providing an operating cost margin of more than 100% and delivering an IRR of 64%. This was under the low capex open pit mining operation scenario.
An estimated upfront capital cost of US$55.3 million was based on using contractor labour, mining equipment and mobile processing equipment. Contractors would also be used for truck hauling the products to port and for ship loading to keep upfront capital costs contained.
The first modules of PFS work will focus on defining the port options and delivering an updated mineral resource estimate which will include the recent 2023 infill DSO drilling across Bekisopa’s northern and central zones. Notably, Bekisopa‘s 5.5 million tonnes of indicated and inferred DSO resource is from just the project’s southern zone.