Sheffield Resources has cut back development at its Thunderbird mineral sands project in Western Australia to reduce capital costs.
The company will scale down activities at Thunderbird while focussing on a more attainable financeable project scope.
Despite the setback, Sheffield managing director Bruce McFadzean believes the decision will boost shareholder value through to 2021.
“We continue to engage with potential funding partners and other third parties to develop the project,” he said.
“We also remain open to pursuing alternate funding and project development strategies to support near term construction of Thunderbird.
“We are very confident our plans will preserve and enhance the substantial value of the Thunderbird mineral sands project for shareholders and, in time, allow us to develop the project as a leading global supplier.”
Sheffield was estimated to produce steady state annual savings of $7.5 million with the new cost reduction measures, with the support from key partners Taurus and Northern Australia Infrastructure Facility (NAIF).
McFadzean stressed the construction of thunderbird had progressed significantly despite finding no equity funding solution.
“The Thunderbird mineral sands project is a world-class asset that is fully permitted, construction ready and perfectly positioned to meet the market need,” he said.
“The continued strong support of our key partners Taurus, NAIF and other corporate advisors has been a critical part of this achievement.
“While this change will be difficult for our employees and other stakeholders, it’s important to acknowledge their significant commitment and contribution to date locally, regionally and internationally.”
The company’s strategic partner process and project financial strategy will also be reshaped to fit the tighter budget.
Following the scale-backs, Sheffield’s long-time executive technical director David Archer will resign from his position later this month.
“I want to draw specific attention to the invaluable counsel and guidance provided by founding director, Mr Archer, and sincerely thank him for his support,” McFadzean said.
“His tremendous achievements from discovery of Thunderbird through to where it stands today as a world class asset speaks volumes.”