A preliminary assessment of the underground possibilities for the Redmoor asset by the consultants Wardle Armstrong concluded there is scope to mine 600,000 tonnes of ore a year for the next decade. That is based on a 7.1mln-tonne resource with a 1.09% tin equivalent grade.
Internal financial modelling of those numbers suggested the mine would have an internal rate of return of 19% and a net present value of US$94mln, funded by capital investment of US$89mln.
MD Peters said: “Using the results of this study, Strategic Minerals believes it has confirmed its view that Redmoor has the potential to be a world class tin and tungsten mine which will deliver attractive returns on investment.”
The current resource base at Redmoor is 11.7mln tonnes, though it currently sits in the inferred category. Strategic believes there is “significant exploration upside”.
Metallurgical testing, meanwhile, “confirms amenability of ore to gravity pre-concentration with good potential recoveries and grades”.
Further work will now be carried out to advance and further optimise the project as it heads towards a more formal pre-feasibility study, investors were told.
Strategic is the 50% owner of the Redmoor deposit, which is around 16 miles inland from Plymouth, and has a deal in place to acquire the remainder.