First Tin (AIM: 1SN), a company with tin projects in Germany and Australia, has published a Definitive Feasibility Study (DFS) for the Australian Taronga project. The DFS highlights the simple processing circuits enabled by the coarse mineralogy, and a low all-in sustaining cost of US$15,843 per tonne enabling a break-even tin price of US$20,510 per tonne.
Bill Scotting, First Tin’s CEO, commented: “We are delighted to deliver this Feasibility Study which highlights the attractiveness of our low capex, low risk, and high margin Taronga Tin project.”
Spotlighting the mineralogy of almost entirely coarse-grained cassiterite in low-strength sheeted quartz veins, Mr Scotting said: “The coarse nature of the cassiterite enables rapid liberation with basic crushing and gravity separation processes.”
The company completed the DFS on a base case tin price of US$26,000 per tonne, with a post-tax Net Present Value (NPV) of AU$98 million and Internal Rate of Return (IRR) of 20%. The DFS stipulates a peak mining rate of 10Mtpa, processing rate of 5Mtpa, and an annual production average of 3,600 tonnes tin-in-concentrate over the 9-year mine life.
On the financial side, the company stated a pre-production capital expenditure of US$116 million, highlighting the low infrastructure costs due to the project’s location, and the potential for low energy costs with the company planning to use solar and gas generators instead of grid electricity.
On operating costs, First Tin quoted mining costs of US$5,758 per tonne tin, processing costs of US$4,523 per tonne tin, and general and administrative costs of $1,726 per tonne tin. The Taronga Full Cost is given as $19,345 per tonne tin sold, placing the project at the lower end of ITA’s cost curve.
Looking forwards, the company expects to bring Taronga into production in 2027 after a two-year construction period, and states there is upside potential provided by recent drilling results received too late to include in the DFS. First Tin discovered new mineralisation between the two planned open pits, and have also defined inferred resources around the perimeter of the existing pit shells. The company also holds exploration licences in the wider Taronga tin district that show similar soil anomalies to those at the main deposit, providing potential for future satellite resources.
Our view: ITA is pleased to see the continued progress at not only Taronga, but also the company’s German Tellerhauser project with an updated MRE published last week. The Taronga DFS highlights the project’s potential as a low-cost mining operation with strong expansion potential.
First Tin plc is a member of ITA’s Explorers & Developers Group.
