Mineral sands miner Iluka Resources has approved development of its Cataby project in Western Australia after confirming offtake agreements for majority of its synthetic rutile production.
Iluka has secured ‘take-or-pay’ offtake agreements for 85 per cent of production from its Synthetic Rutile kiln 2 operation at Capel in WA for at least four years.
The Cataby project, a large chloride ilmenite deposit 150km north of Perth, will support the ongoing production of 200,000 tonnes of synthetic rutile from Capel.
Iluka expects Cataby to cost up to $275 million to build. It will require a construction workforce of 250 people and 160 full-time employees once it is operational.
The Perth-based miner plans to launch production at Cataby during the second quarter of 2019 following an 18-month construction period.
Tom O’Leary, Iluka’s managing director, said the company worked closely with customers to secure offtake agreements for a significant proportion of the synthetic rutile production associated with the Cataby project.
“The project ensures that our customers will have continuity of synthetic rutile supply; and also delivers significant economic benefits to two separate regions in Western Australia – Dandaragan and Capel,” O’Leary said.
“The construction period – with works to cost between $250 million to $275 million – will employ up to 250 workers at its peak. Once in operation, the project will sustain a workforce of approximately 160 people.
“Pre-execute contracts have been awarded and tendering for the balance of construction contracts is well advanced.”
Iluka has forecast Cataby to produce an average of 370,000 tonnes of chloride ilmenite a year over an 8.5-year mine life. Cataby will also produce an average of 50,000 tonnes of zircon and 30,000 tonnes of rutile a year.
The operation’s mine life has the potential to be extended by another four years by accessing an additional 40 million tonnes of ore in its reserve.
Iluka has already obtained environmental approvals for Cataby, completed detailed engineering, established a project team, and procured long lead items.