Digging in for posterity
TOWNSVILLE business leaders have welcomed the approval of a revised development plan for a billiondollar zinc mine project in northwest Queensland, describing it as a muchneeded shot in the arm for the mining industry and region’s economy.
The mine, being developed by Chinese- backed MMG Ltd at Dugald River near Cloncurry, will require an estimated $ US750 million ($ 1.04 billion) investment into a range of mining infrastructure and services, including a permanent 350- person village. Townsville Enterprise general manager economic development Tracey Lines said investments of this magnitude were catalytic for the development of northern Australia and critical for the growth and prosperity of the region.
“For this decision to be made at this point in the commodity cycle shows that investors have confidence in the future of the north Queensland region,” Ms Lines said.
“This type of large- scale investment brings development and employment which flows through the economy.” Ms Lines said it came on the back of Queensland Investment Corporation’s $ 130 million purchase of Domain Central shopping precinct at Mount Louisa and the Sichuan Railway investment group’s $ 200 million investment into Altona’s Little Eva mine project north of Mount Isa. Townsville Port chairman Pat Brady said it was a shot in the arm needed by the mining sector and for people in the corridor between Mount Isa and Townsville who have been doing it tough.
The mine will have a production rate of 1.5 million tonnes per annum, producing on 160,000 tonnes of zinc in concentrate per annum, as well as 18,000 tonnes of lead and 981,000 oz of silver in concentrate per annum.
MMG says mine closures and few replacement projects are creating a zinc supply gap which is forecast to boost the galvanising metal’s price 50 per cent to about US$ 1.50 a pound over the next year.
The main project scope includes the ramp up to the 1.5 million tonne production rate, the development of a 500,000- tonne stockpile, a concentrator and associated infrastructure, a paste plant, mining infrastructure and services, offsite infrastructure including high- voltage transmission line and substation, mobile plant and equipment, a permanent 350- person village and on- site services and utilities. Concentrates will be loaded into containers on site, trucked 65km to Cloncurry and then railed to Townsville for shipping. The development is conditional on an amended Environmental Authority, a revised classification of the mine’s tailings storage facility and approval for shipping from Townsville port.
Pre- production mine development will start this year. First production is expected in the first half of 2018.
INVESTOR CONFIDENCE: Pre- production mine development at Dugald River, near Cloncurry, will start this year.