On February 21, UK-based London Mining, a global diversified miner targeting the steel sector, announced the results of a 15 million mt per year scoping study for its Isua Project in Greenland completed by Quebec, Canada-based engineering and construction company SNC Lavalin.
The SNC Lavalin study of June 2010 considered a 10 million mt per year operation with a 21-year initial mine life and estimated capital expenditure of US$1.7 billion. The new scoping study considered a 15 million mt per year open pit and processing operation with a 15-year initial mine life for estimated capital expenditure of US$2 billion.
London Mining said that Isua's capital intensity has reduced, in the latest scoping study, by about 22 percent to US$136 per annual thousand metric tons of capacity. The company notes that the new scoping study includes higher operating costs than previous studies, mainly due to higher fuel costs. Operating costs are now expected to be US$29/mt - rather than US$27/mt.
Project to produce high quality pellets
Isua, which currently has a JORC resource of 951 million mt grading 36 percent iron, will produce a premium quality 70 percent Fe pellet feed concentrate with low impurities and benefits from its position in the warmer southwest corner of Greenland which allows for year round shipping. The project is located 150 km northeast of Nuuk and is wholly owned by London Mining Plc.
A full bankable feasibility study that will also include the latest scoping study will be completed by the end of 2011 with construction estimated to start in 2012 and first production at the beginning of 2015.