“Basically, this will the transformation of Strike Resources from an exploration company into a production company – that’s going to be significant for us,” Johnson said. Having listed in 2004, Paulsens East looms at Strike’s first production project, and it’s not something that’s lost on management. “We’re in the final stages of getting all the permits and approvals we need so we can get into production next year,” Johnson said. It is a point of pride for Johnson that, notwithstanding the difficulties that this created for Strike at the time, he and his team were still able to reach a mutually beneficial agreement with the traditional owners.Īlso under Strike’s belt is the all-important mining lease, leaving it well placed to tackle 2021 as an iron ore producer. This event occurred in the midst of negotiations between Strike and the PKKP regarding the development of Paulsens East.
It was on PKKP land that the Juukan Gorge disaster unfolded earlier this year, a decision which resulted in the loss of historically significant Indigenous rock shelters and led to a clear out at the top of Rio Tinto. Of the company’s work this year, Johnson cites the achievement of a Native Title Agreement with the Puutu Kunti Kurrama and Pinikura (PKKP Group) peoples – the traditional owners of the land on which East Paulsens sits – as a circumstantially important development. Pic: Suppliedīut getting a project to a point where mining can begin is a huge challenge, and it’s this work which has occupied much of Strike’s work in 2020 with a view to production in the New Year. “That’s very encouraging for us in terms of getting our projects underway.” The Paulsens East project. “Everything we see at a macroeconomic level coming out of China, and even the supply constraints out of Brazil – it’s enough for us to believe that prices are going to stay strong for a long time.
LUCKY STRIKE MINE DRIVERS
“This extremely strong market for iron ore is one of the key drivers for us in terms of the advantage we have at Paulsens East,” he said. It’s little wonder Johnson intends for the company to Strike while the iron is hot – obvious pun intended. Net cashflows before tax are estimated at $167 million, and the project has a net present value of $140 million based on an assumed average benchmark iron ore price of US$100 per tonne over an anticipated four-year mine life.Īs of this morning, iron ore prices sat above US$151.
It revealed a low-cost iron ore project – just $15.7 million is estimated in pre-production capital expenditure, with an internal rate of return of 213%.
The owner of the Paulsens East project in the Pilbara, Strike’s feasibility study on Paulsens East was revealed to market in November. A combination of supply constraint and disruption out of Brazil, coupled with Chinese stimulus designed to mitigate the effects of the pandemic, has pushed prices up to the benefit of many.Īmong them all, Strike Resources (ASX:SRK) may well be one of the best placed to benefit. There’s no secret that the red rock has been on a hot streak this year.
Special Report: Quizzed on his 2020 highlight, it’s probably unsurprising that Strike Resources managing director William Johnson’s first thought is the iron ore price.
0 kommentar(er)
