Mustang Resources Ltd (ASX:MUS) has concluded from a strategic review that its Caula Graphite Vanadium Project in Mozambique could achieve first production by mid-2019.
The review’s key recommendation was to establish trial mining and processing operations for completion during the June quarter of 2019.
Mustang’s board of directors has accepted the recommendation.
READ: Mustang Resources' high-grade drill results strengthen plan to develop Caula graphite-vanadium project
Mustang considers that trial mining and processing operations at Caula could produce both graphite and vanadium concentrates.
The trial mining development strategy is based on a robust, low-cost mining operation and construction of a processing plant capable of handling 100,000 tonnes per annum of ore.
Scoping study to consider full-scale mining and processing operation
The strategic review does not form part of the formal scoping study, which is set for completion in the June 2018 quarter.
The scoping study will consider the merits of a full commercial-scale graphite and vanadium operation.
Conditional on a positive outcome of the scoping study, a definitive feasibility study (DFS) will be undertaken to serve as a basis for project development and financing.
Caula’s vanadium potential to increase project economics
The Caula ores are considered to be broadly similar to ore at the nearby Balama Project of Syrah Resources (ASX:SYR).
In July 2014, Syrah published the results of its vanadium scoping study.
The outcome of the study was very positive and most of the conclusions drawn have relevance to Caula.