Magnetite Mines Limited announced the results of optimisation studies carried out for its 100%-owned Razorback Iron Ore Project, in the emerging Braemar Iron Ore Province of South Australia. Launched in September last year, these studies have identified the optimum development pathway for the Project, commencing with an initial capacity of 5Mtpa concentrate output. Key outputs from this comprehensive program of work include: Best-case Project configuration confirmed as a staged development commencing with Stage 1 capacity of 5Mtpa concentrate output, with potential to expand to 10Mtpa after 5 years. New JORC-compliant Probable Ore Reserve calculated with a 340% increase in tonnage from 473Mt to 1,615Mt based on a 5Mtpa production scenario, not including Iron Peak. DFS-quality metallurgical studies completed, substantially de-risking process design, flowsheet; equipment selection - all based on well-proven, industry standard technologies. 100% of Stage 1 concentrate production to be DR-grade, pellet feed quality: 68.5% Fe with low major impurities (3.0% combined silica + alumina). This feature establishes Razorback as a key contributor of the Green Steel supply chain. Stage 1 to take advantage of existing product transport infrastructure with road transport planned to rail siding, and then rail to port. MoU with SIMEC firms Whyalla as logical Stage 1 port for Razorback concentrate export. Renewable energy supplied from South Australia's electricity grid confirmed, with transmission and connection design well advanced in conjunction with SA's electricity transmission provider ElectraNet. Three technically and economically viable Project water supply options costed. Preferred option is currently undergoing commercial in confidence negotiations. MGT is now completing mining studies on the recently upgraded high-grade Iron Peak Resource to support Ore Reserve estimation and enable completion of financial modelling for the new Project configuration with results expected in the near future. The Company has also commenced a value engineering (VE) program to reduce capital and operating costs for the new Project configuration prior to DFS-level engineering. Other priorities include securing the preferred water supply option, producing concentrate samples for customer assessment, completing geotechnical field work to support DFS-level engineering, and advancing negotiations with infrastructure partners. Upgraded Iron Peak Resource radically improves Project: On 9 February 2023, MGT announced that the Iron Peak deposit Mineral Resource Estimate, part of the wider Razorback Iron Ore Project, was extensively upgraded based on new drilling completed in 2022. The improved mass recovery (19.4%) enabled improved metallurgical response and the production of premium, DR-grade concentrates. This work escalated the 503 million tonne Iron Peak Resource to be the highest quality deposit within MGT's portfolio. Commencing operations with the highest-grade ore available is a well-proven strategy for de-risking economic performance during the critical first years of a new mine. Accordingly, MGT plans to prioritise Iron Peak for initial plant feed with the selected 5Mtpa Stage 1 and expanded 10Mtpa cases now potentially benefiting from Iron Peak ore exclusively for the first 10 years of the Project. Best-case Project configuration identified: Optioneering was carried out to compare various combinations of Project options identified during the optimisation studies, with the objective of identifying the best-case Project configuration in. Key assessment criteria were relative project economics and development /technical risk. An initial plant capacity of 5Mtpa concentrate production was identified as the optimum Stage 1 scale for Razorback, balancing capital intensity, use of existing infrastructure and operational complexity, with customer expectations and economies of scale. With 4.5 billion tonnes in Resources at Razorback, full value for the Project will be best realised through staged expansion over time. Following the successful commissioning and ramp up of Stage 1 operations, the Company's objectives will be to: Optimise plant metallurgical response, product quality and operating costs Achieve brand recognition in the market and build reputation as a reliable supplier Produce positive cash flows in support of project financing for a Stage 2 expansion to 10Mtpa in Year 5. Razorback Ore Reserves upgrade, excluding Iron Peak: As detailed in a separate release by the Company, JORC-compliant Ore Reserves have been estimated
for the 5Mtpa capacity case, utilising only material from the Razorback deposit (i.e. does not include the Iron Peak deposit) at Indicated classification as follows: This represents a 340% increase from the current Razorback Ore Reserves of 473Mt. The Iron Peak Mineral Resource is currently being assessed for Ore Reserves to enable completion of financial modelling in support of the new Project configuration, with results expected in the near future. Iron Peak remains open along strike and at depth, and there is considerable potential for further drilling to expand the deposit further. Process Plant design based on DFS-level metallurgy: Leveraging off the extensive metallurgical and engineering studies completed to date, the optimisation studies focussed on economies of scale benefits related to increased capacity plant configurations to take advantage of larger, or more efficient, equipment such as increased primary crusher sizing to
support two production lines. SAG milling, a widely used primary grinding technology, has been selected for the new Project configuration. In addition to initial capital efficiencies, SAG mills offer a smaller footprint and reduced operational risk owing to its maturity in mining applications. Tailings: Central Thickened Discharge (CTD) design selected: To maximise water recovery and to reduce capital costs, two alternate tailings deposition methodologies were considered: conventional medium-density (60% solids) wet tailings dam; and a thickened (65-70%) central discharge style (CTD), with the latter selected for the new Project configuration based on its increased water recovery, smaller embankments, reduced environmental and permitting risk and reduced capital aspects. The construction of the tailings dam wall will include the use of classified coarse tailings generated following rougher magnetic separation. Use of this 0.14mm material for dam wall construction was confirmed by testwork and the methodology is currently used in similar large capacity tailings operations globally.
Concentrate Transport: The scale of the Project requires efficient transport of concentrate products, and capital intensity was prioritised for initial production scenarios, together with expansion optionality for expanded production scenarios.