Seeking Alpha

Proactive Investor's  Instablog

Proactive Investor
Send Message
Proactiveinvestors is a leading multimedia news organization, investor portal and events management business with offices in New York, Sydney, Toronto and London. Proactiveinvestors operates five financial websites in four languages providing breaking news, comment and analysis on hundreds of... More
My company:
Proactiveinvestors
My blog:
Proactiveinvestors
  • Great Western Files PEA For Steenkampskraal; To Focus On Project Costs 0 comments
    May 1, 2013 3:06 PM

    Rare earths alloys maker Great Western Minerals Group(CVE:GWG) (OTCQX:GWMGF) says it has filed its prelimimary economic assessment study results that were announced in March for its Steenkampskraal project in South Africa, and is now focused on reducing the capital required to restart the mine.

    The rare earths processor, which is transitioning to a fully integrated rare earths producer, makes specialty alloys used in the magnet, battery, defence and aerospace industries from two facilities in the U.S. and U.K. Its development program at its Steenkampskraal rare earth mine in South Africa, which includes a restart of the historical mine, is central to ensure a strong flow of feedstock for its downstream processing unit.

    The preliminary economic report highlighted a C$555 million after-tax net present value for the project, when applying a 10 per cent discount rate, and a 28 per cent South African corporate tax rate.

    The study also estimated a 66 per cent internal rate of return and a two and a half year payback period, on an after-tax basis, from the start of underground mining for the project - which has an 11-year potential mine life.

    "We have directed our resources where we believe we can get the greatest return and add substantive value to the project to include a focus on finalizing the feasibility study which will provide greater clarity about project costs thereby reducing the risk for development," said president and CEO, Marc LeVier, in a statement Wednesday.

    "Given the impact global economies have had on the mining industry and limiting access to capital, we have stopped geo-development drilling and deferred other site development activities."

    He added that the company is in discussions with parties that have indicated interest in off-take agreements for metal alloy products it produces. "Any off take agreements combined with a potential tolling agreement for the separation plant will help to reduce the capital required to bring Steenkampskraal to production," he said.

    Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.

Back To Proactive Investor's Instablog HomePage »

Instablogs are blogs which are instantly set up and networked within the Seeking Alpha community. Instablog posts are not selected, edited or screened by Seeking Alpha editors, in contrast to contributors' articles.

Comments (0)
Track new comments
Be the first to comment
Full index of posts »
Latest Followers

StockTalks

More »

Latest Comments


Posts by Themes
Instablogs are Seeking Alpha's free blogging platform customized for finance, with instant set up and exposure to millions of readers interested in the financial markets. Publish your own instablog in minutes.