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IMX Resources Delivers Updated Preliminary Economic Assessment On Ntaka Hill

IMX Resources (ASX; IXR, TSX: IXR) has received the results of the updated preliminary economic assessment (PEA; Scoping Study) for the development of the Ntaka Hill Nickel Sulphide Project.


- Estimated C1 cash costs of USD 5.00 per pound of payable nickel which is mid range for global nickel producers
- Clear cash operating margin demonstrated over various metal price assumptions, including current spot price
- Estimated mine life of approximately 15 years
- Average annual contained nickel production of 10,000 to 15,000 tonne per annum
- Confirmed pre-production capital investment of USD 227M
- NPV of USD 212M after tax based on 2011 PEA metal pricing (compared to USD 207M)
- NPV of USD 147M using three-year trailing average prices in line with US SEC guidelines which compares favourably to the 2011 PEA analysis (USD 122M) using these same metal prices


- Potential increase in both grade and tonnage at Sleeping Giant from: (i) in-fill drilling of near surface hanging wall mineralisation to the north, and (ii) extension drilling targeting down plunge higher grade core
- Potential for delineation of new near surface mineralised zones close to the existing resources, currently being drill-tested
- Optimisation of flotation conditions is likely to improve the already excellent metallurgical performance. A definitive test work program, which includes extensive variability testing, is currently underway
- Future optimisation of the mining plan as part of a PFS, has potential to reduce up-front stripping requirements and defer cash flow for mining activities

Neil Meadows, managing director, commented: "It is encouraging to note that even at the current low spot metal prices there is an estimated healthy cash operating margin which indicates a potentially robust project at the range of prices to be expected in the highly volatile nickel market.

"The work carried out for the updated PEA was aimed at de-risking the Project in order to allow the Company to make an informed commitment to more detailed evaluation and development in the second quarter of next year.

"The ongoing program of drilling at Ntaka Hill, environmental permitting and definitive metallurgical test work together with a mineral resource update will be completed in the first quarter of 2013."

The Project is located approximately 250km west of the port town of Mtwara, and is part of the 100% owned Nachingwea property in south eastern Tanzania.

Updated PEA

The updated PEA is based on information collected over the past year which includes the updated March 2012 resource, a more thorough preliminary investigation of possible mining methods, additional metallurgical and infrastructure studies, and environmental investigations and permitting activities.

Two options continue to be considered:

- open pit mining only, and;
- open pit mining with underground mining of the Sleeping Giant Zone.

Both options are identical for the initial production period. Project highlights and key potential economic outcomes for both of the options considered by the PEA are detailed in the following tables.

Ongoing Work and Next Steps:

Based on the results of the updated PEA, IMX's board and management are committed to continuing with the evaluation and long lead development activities for the Project in order to reduce the project risk profile. The following work program is currently underway and expected to be completed early in 2013:

- Continued investigation and discussion with the Tanzanian government departments and other groups to secure access to key project infrastructure such as power, roads and port facilities.

- Completion of the environmental and social impact assessment (ESIA) that is already well advanced with an aim to receiving environmental approval by the end of the first quarter of 2013.

- Definitive metallurgical test work program that is currently underway on approximately 12t of sample at G&T Metallurgical Laboratories in Kamloops, Canada, and expected to be completed during early 2013.

- Mineral Resource update on the basis of current drilling program(between 20,000m and 25,000m), which is expected in the first quarter of 2013.

- Continue optimisation of mining options to identify a single development plan based on the updated resource (1Q13).

Subject to the outcomes and market conditions, a PFS/FS5 will be commenced aimed at allowing a project commitment in late 2013 which could lead to production commencing in late 2015.