Viridis Mining & Minerals has taken a significant step towards producing a scoping study for its promising Colossus rare earths project in south-east Brazil after securing a world-renowned contractor to deliver the work.
The company today revealed that rare earths specialist Hatch has been awarded the contract for the project in the Brazilian State of Minas Gerais that previously nailed thick diamond drill hits at both the Fazenda and Central prospects.
Hatch is expected to start work on the study next month. It will involve an initial assessment of how best to deliver the Colossus project, with a keen focus on Viridis’ highly-prospective northern concession areas of Fazenda, Caminho Das Pedras, Central and Carijo.The key deliverables from the scoping study will include details on processing and production methods, flow rates and associated mine life and capital expenditure, and operating expenditure estimates to enable the project to operate at its nameplate capacity.
The study will also assist with asset lifecycle financial modelling and help assist with project financing and offtake discussions, in addition to supporting mining permit applications and environmental impact assessments.
Having spent most of my career delivering major capital projects, you quickly learn that the calibre of your engineering contractor, early in your development journey, plays a crucial part in de-risking the execution phase of the project including the environmental approvals process.
Viridis Mining & Minerals chief executive officer Rafael Moreno
A scoping study is on the first level of mining studies and provides an early-stage evaluation of a project’s potential economic viability and to assess if it justifies moving forward to the next level of investigation – the prefeasibility study (PFS).
Some of the key points to come from the scoping study are how much funding will likely be needed to begin production of the project, how the mine will mine operate once it is built, how much of the commodity a mine produce annually and the expected mine life.
Based on those details and assumed commodity prices and operating costs, it also aims to define the expected profitability of the project and the return on invested capital.
Hatch is a global consultancy with offices in Perth and Brazil and both offices have forged a strong track record in relation to rare earths processing throughout a full project lifecycle. The contract awarded by Viridis includes engineering support work and the company says it strategically selected Hatch based on the location of the consultant’s two offices and for its outstanding experience in the rare earths processing space, with a specific focus in Brazil.
Other ASX-listed companies such as Lithium Universe and Lithium Energy have recently engaged Hatch to conduct studies for their respective projects. Hatch recently completed a scoping study for Lithium Energy’s Argentine lithium project and is working on an engineering study for Lithium Universe’s battery-grade refinery in Quebec.
Colossus is adjacent to Alcoa’s existing mining and processing operations, potentially enabling Viridis to leverage the nearby mining labour force, existing infrastructure and permitting. An added benefit is that legislation will allow immediate conversion to a rare earths mining license once exploration is completed.
Recent drilling results from the project highlighted several zones with tremendous potential. Diamond drilling at the Fazenda prospect jagged an eyebrow-raising hit of 48.5m going 2662 parts per million total rare earth oxides (TREO) from surface including 33.5m going 3091ppm TREO – the deposit’s best result to date.
The Central prospect’s campaign nailed a 40m hit grading 2352ppm TREO from 7m including 16m at 3401ppm, while first-pass results at its Caminho Das Pedras target delivered 26m at 2295ppm TREO from surface including 9.5m going 3079ppm.
Ionic clay rare earths projects have many advantages over their hard-rock counterparts. Despite lower grades and lower recoveries, the extraction of ionic-adsorption clays is levels cheaper from an operational and capital perspective.
Benefits include mineralisation occurring at surface, minimal stripping, clay-hosted soft material requiring no blasting, no crushing and milling and a simple one-step leaching process. There is also no requirement for a tailings dam, low levels of uranium and thorium and no radioactive tailings.
With Viridis’ recent raise of $4.5million, cornerstoned by $1million chipped in by executive chairman Agha Shahzad Pervez, the company is well-placed to fund the study to ascertain if Colossus can “cut the mustard” as a viable rare earths project.
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