Element 25 Limited (ASX:E25) has been granted a 21 year Mining Lease M52/1074 for the development of its Butcherbird Manganese Project by the Western Australian Department of Mines, Industry Regulation and Safety, paving the way for the formal lodgement of mining approval documentation.
Managing Director, Justin Brown, said a number of the relevant approvals required to commence mining are well advanced and will be lodged within the coming weeks.
The company is targeting a staged development strategy with production of manganese concentrate to generate early cashflows with a low capital requirement for Stage 1, followed by expansion into downstream processing to produce high purity manganese in future plans.
A Pre-Feasibility Study (PFS) released in May 2020 has demonstrated outstanding economics with respect to the production of manganese concentrate, confirming the potential for a robust, long life operation with a low capital cost and strong operating margins.
Mr Brown said the company now intends to expedite project delivery and commence production as soon as practicable.
The grant of the mining lease at Butcherbird is a pivotal step in the development of this world class project and puts the company in a position to fast track the project towards commencement of production and cashflows,” Mr Brown said.
The Butcherbird Manganese Project is a world class manganese resource with current JORC resources in excess of 263 Mt of manganese ore. The company’s recently completed PFS examined the development of the deposit to produce manganese concentrate for export to generate early cashflow with a modest capital requirement.
The outstanding economics and low capital hurdle of less than A$15 million will allow the company to develop the project in a shorter timeframe than would have otherwise been possible.
This is envisaged as the first stage of a staged ramp up for the project and has the advantage of potentially providing early cashflow to strengthen the company’s balance sheet and assist in funding of the larger high purity manganese production hub which is the subject of a parallel, complimentary work stream.
The Project straddles the Great Northern Highway and the Goldfields Gas Pipeline providing turnkey logistics and energy solutions.
The company is also intending to integrate renewable energy into the power solution to minimise the carbon intensity of the Project as well as reducing energy costs.
Mr Brown said a cleaner, lower carbon flowsheet and high penetration renewable energy will place Butcherbird at the forefront of sustainable metal production.