jose paixao, south american ferro metals: a review of the ponto verde iron ore in brazil
DESCRIPTION
José Márcio Matta Machado Paixão, CDO - Chief Development Officer, South American Ferro Metals delivered this presentation at the 2013 Americas Iron Ore conference. Americas Iron Ore is one of the most respected annual gatherings for North and South American iron ore markets. The agenda features iron ore industry and market developments; new project developments and expansions in North and South America; overview of steel demand; iron ore spot market price; infrastructure and transport challenges and investment opportunities. After five successful editions, the Americas Iron Ore Conference consolidates as the largest meeting place for executives and professionals of the steel and iron ore industry in the region. For more information, please visit the conference website: https://www.immevents.com/mining-conference/americas-iron-ore-conferenceTRANSCRIPT
South American Ferro Metals Limited
November 2013
www.safml.com
Profitable Brazilian iron ore
producer
Expansion plans on track:
- Currently 1.5Mtpa
- 8Mtpa
- 16Mtpa
65.5% Fe content
Drilling to increase the
resource
ASX:SFZ
Strong Geology & Resource Base
Technical
5th Highest grade resource in Brazil.1
Lowest 10% on the Brazilian cost curve.1
Total cost of beneficiation production has
dropped in this financial year following full
ramp up of the Second Concentrator in July
2013.
Setting
Ore body runs NE to SW
Herculano & Vale’s Pico mines to the north of
SAFM’s site
Ore body open to the North, and West
Geology
Hematite-rich Itabirite ore
Resource 301.6Mt at 40.7% Fe
Located in the heart of Brazil’s prolific and historic Iron Ore Quadrilateral
1 RBC Prospector - 15 Jun 2012
SAFM
VALE
Drilling to Target Resource Increase
November 2012: Updated resource from 230 million tonnes to 277.9 million tonnes.
April 2013: Increase of its resource estimate within the open pit envelope from
277.9 million tonnes to 301.1 million tonnes.
Mineralisation extends to a depth of over 400 metres. Drilling is underway to target the
core of the deposit at depth and extensions to the north of the current projected pit
envelope. This has the potential to further increase the size of the deposit.
Breakdown of the current resource is :
Ponto Verde Iron Ore Project
(Cut-off Grade Applied: 20% Fe)
Resource Class Tonnes (Mt) Fe (%)
Measured 72.76 41.06
Indicated 101.96 40.68
Measured & Indicated 174.72 40.84
Inferred 126.34 40.45
Total Resource 301.06 40.65
SAFM & Brazil - Environmental
4
Very Simple Current Operation
Very friable material – no blasting
Very simple ore treatment:
- Wet crushing and screening plant: small lump & sinter-feed
- WDRE and WHIMS plants: concentrate
- Vertical thickener to recover water
The existing plants are being used to generate the current products and also as a pilot
plant for the expansion testworks.
Recent Profitability Enhancements
Constructed and Commissioning of Second Concentrator on schedule and within budget
and completed in July 2013. Targeted additional concentrate production of 20,000 to
24,000 tonnes per month, at a grade of approximately 65.5% Fe, which represents an
increase in production of approximately 33%. This increase in production will be at a low
incremental cost which will increase profitability of the operations.
On-site laboratory completed providing quick assay results for production as well as
assisting in design of the enlarged pit.
All production is sold domestically in Brazil and with the expansions plans expect to
export overseas.
September and October SAFM had its production record producing in the full capacity in
the three plants.
v
v
Product Range – Commercial Optimisation
15% or 225 ktpa Lump
Current 1.5 Mtpa ROM Feed
27% or 405 ktpa Sinter Feed
16% or 240 ktpa
Stage I Concentrate
18% or 270 ktpa
Stage II Concentrate
(Commissioned July
2013)
76% Mass Recovery or 1,140 ktpa
Investment Highlights
Only non-Brazilian ASX Listed pure iron ore producer in South America
Located in prolific Iron Ore Quadrilateral (neighbouring Vale)
Near to infrastructure and sell to local domestic customers
JORC resource of 301.6Mt at 40.7% Fe of which 174.7 Mt is Measured and Indicated (5th richest Fe grade in Brazil, Phase III drilling program underway)
BFS for Stage I expansion from 1.5 to 8Mtpa ROM underway
Stage II expansion to 16Mtpa ROM targeted for 1 year after the first one
Growing Profitability - Stage II Concentrator completed and commissioned July 2013
Highly experienced & successful Brazilian leadership team
Expanding to 8Mtpa then to 16Mtpa
Feasibility Study: Companies Involved
Study Management, Plant & Infrastructure and BFS Level Report
Owner’s Team Support and Slurry Pipeline Study
Drilling Campaign
Resource Assessment & Geotechnical Studies
Metallurgical Testworks
Feasibility Study: Companies Involved
Railway Loading Station Design
Mine Planning & Waste/Tailing
Environmental Permits and Water Supply
Financial Model
Feasibility Study: Companies Involved
Market Research
HV Switchyard
Power Transmission Line
Capex/Opex
Feasibility Study Progress
8 Mtpa ROM expansion feasibility study progressing with plant size and equipment
selections being addressed for:
Primary crushing
Secondary crushing
Ball mill
Cyclone classification
Magnetic Concentration
Concentrate transported by slurry pipeline to railway terminal
Tailings thickening, filtration, stockpile and disposal.
Current grind sizing is a concentrate below 0,150 mm.
Average composition of the Concentrate coming from the recent test works is:
Fe SIO2 Al2O3 P Mn LOI
65.5% 3.9% 1.1% 0.02% 0.50% 1.42%
LOW PHOSPOROUS
Feasibility study Flowchart
Plant & Mine Layout
Additional Area for Waste & Tailing
Port access
Memorandum of Understanding with rail corporation, MRS Logistica SA, to develop rail
based port delivery for export of SAFM’s production.
Proposal to rail production to port terminals at Baia de Sepitiba in the state of Rio de
Janeiro, approximately 400 km from the Ponte Verde mine.
The Ponto Verde mine is located 15 km west of the Andaime branch line of the MRS
system, which transports production from the Minas Itabiritos mines adjoining Ponto
Verde.
The rail transportation of the product will utilise existing MRS infrastructure for the
transport and unloading of iron ore products, as well as development of a new loading
terminal.
Port access map
Growth: Stage I Operations Expansion
Stage I Bankable Feasibility Study (BFS) Underway
Will include “Footprint” and “Tie-ins” for Stage II Expansion to 16Mtpa
Accessing export markets
Construction is expected to start in 2014
Funded from operations and debt.
…From 1.5Mtpa to 8Mtpa ROM
Growth Plan: Stage II Operations Expansion
Stage II BFS to begin upon Stage I Study Completion
Mirror image of Stage I Plant
Foot print and tie in established during 8Mtpa expansion design
…From 8Mtpa to 16Mtpa ROM
For more information: Australia
Registered Office
Level 11, 151 Macquarie Street
NSW 2000
Tel: +61 2 8298 2000
Fax: +61 2 8298 2028
Thank you!
Zeca Paixão Chief Development Officer
Mobile: (55) 31 8448-8982
Brazil
Av Afonso Pena 3130 9° Floor
30130-009
Belo Horizonte/MG
Tel: +55 31 3281 8777
Fax: +55 31 3281 8997