Written by 12:34 pm Australia, Company - Clients, Mining, Top Stories, VRX Silica

Engineering Update on Arrowsmith North Project

Engineering Update on Arrowsmith North Project
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VRX Silica Limited (ASX: VRX) (VRX or the Company) has finalised all the required engineering work for the silica sand processing plant construction at The Arrowsmith North Silica Sand Project, with a 2 million tonnes per year capacity. The Project cost was determined in 2019 at the introductory level of AUD 28.3 million, including ~AUD 6 million for contingency. The latest cost estimate will be updated this year upon retendering of necessary equipment.

According to Mr Bruce Maluish, MD, the primary detailed design phase of the Project is complete, based on metallurgical test work, process circuit design peer review, and testing. The Company plans to detail minor items during the execution phase without affecting the execution schedule. The Innovative techniques involved in the design bring flexibility for the Company to produce various products as per market requirements for foundry and glassmaking. 

He said, “The Company has developed several unique processes with its metallurgical consultants to produce the most valuable, high-yield, and high-quality silica sand products possible. He believes this design work will enable production at Arrowsmith North Project with low emission and carbon footprint.” 

Location of Arrowsmith North Project

Figure 1: Location of Arrowsmith North Project

What is captured in Detailed Design? 

The Company has provided a list of items which they have detailed designed and peer-reviewed and are now ready for execution:

  • Site and Plant Layout drawings, PIDs and PFDs
  • Civil works for plant and Product area, southern access road, as well as Brand Highway interface
  • Concrete, water management, Circuit mass balance
  • Mechanical Equipment List, 3D design model, Fabrication drawings

Several areas/items are concept designed and will be detail designed later during the execution phase of the Project, including:

  • The mine plant area, including the feed hopper, transfer conveyors, trammel, and other associated equipment such as water tank & pump skids, pipe systems, etc. The vendor has been identified and tendered for the other equipment
  • Non-Process Infrastructure (NPI) has been included in site-layout drawings but will be developed during the execution phase. This includes admin, crib, toilet builds and water/waste-water system, workshops, stores, laydown, vehicle wash bays, etc.

Details on Equipment  

  • Some major equipment is tendered, such as Cyclone clusters, Water pumps, Slurry pumps, Air compressors, Feed hoppers, Conveyors, etc.
  • Minor equipment is yet to be officially tendered, such as a Bore pump set, Fabricated steelwork, Chute, Transportable buildings, etc.
  • Several machines used for second-hand processes are purchased and refurbished, such as Feed trommel (Primary screening machine) and Vibrating Screen (The final product sizing screen).

Figure 2: Feed Trommel

Schenk Vibrating Banana Screen

Figure 3: Schenk Vibrating Banana Screen

Project Execution Details 

The Company is planning to observe several essential milestones before commencing construction:

  • Establish commencement date and finalise the finance
  • Site access date to construct the northern access road and plant 
  • Approval to place the order for major long-lead equipment 

Short Term Ongoing Tasks

The Company has planned to carry on with the following development tasks of the Project:

  • Evaluate the retendering of significant equipment, monitor its lead times, and try to reduce it
  • Update the execution cost estimate by areas, refine the execution schedules and thus man histogram for execution phases to plan accommodation
  • Liaise with the power provider to develop a preferred power source
  • Review the operation and control strategy

The Arrowsmith North Silica Sand Project 

The Arrowsmith North Silica Sand Project is about 270km north of Perth. It is VRX Silica’s most advanced Project in Western Australia. This Project is strategically situated as it benefits from Brand Highway and Geraldton-Eneabba railway and a connection to Geraldton Port for bulk exports. According to the latest updates, this Project has 513 million tonnes of Mineral Resources and 221 million tonnes of Ore Resources.

Figure 4: Total Silica Sand Mineral Resource of VRX Silica Limited

About VRX Silica

VRX Silica Limited is the global pioneer in silica sand mining in Western Australia. The Company, led by MD Mr Bruce Maluish and a highly experienced management team, is meeting global silica sand demand. VRX is a pure-play silica sand Company having advanced projects, namely, the Arrowsmith North Silica Sand Project, the Arrowsmith Central Silica Project, and the Muchea Silica Sand Project.

About Managing Director Mr Bruce Maluish

Mr Bruce Maluish, Managing Director of VRX, is a mining industry veteran with over 40 years of experience. Along with mining, he has worked in various sectors, including gold, nickel, and mineral sands from both open pits and underground mines. He has been in multiple organisations such as Matilda Minerals, Abelle, Hills 50, etc. Internationally, he is experienced in the identification of projects and negotiations with clients in Asian markets.  

Mr Bruce Maluish, Managing Director of VRX Silica Limited

Figure 5: Mr Bruce Maluish, Managing Director of VRX Silica Limited

Investor Outlook

  • VRX Silica’s share price stood at AUD 0.11 per share as of May 29th, 2023, with an average 52-week range of AUD 0.190 to AUD 0.093 per share
  • As of May 29th, 2023, VRX Silica’s market capitalisation was AUD 61.64 million
  • The Company has 560.4 million shares on the issue with unlisted options of 41.3 million
  • VRX Silica completed the detailed engineering work for the construction of a processing plant with a capacity of 2 million tonnes per annum at The Arrowsmith North Project 
  • Silica Sand is an essential commodity for glassmaking and solar panels. Currently, the Asia-Pacific region is facing a supply shortfall, and the resultant prices for the commodity are increasing continuously. VRX has been granted a mining lease with secure tenure over four important high-grade silica projects to meet the growing global demand
  • The recognition by the Australian Government of the importance of silica sand and the potential of VRX is an important step forward. VRX noticed several subsequent enquiries from many countries, followed by trips made by Australian Government trade delegations

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