Arrowsmith North
Arrowsmith North Silica Sand Project
The Arrowsmith North Silica Sand project is VRX Silica’s most advanced project, with production scheduled to commence in 2024 subject to environmental approval.
Arrowsmith North is located about 270km north of Perth, Western Australia, and adjacent to the Brand Highway and Geraldton-Eneabba railway – giving the company a direct connection to the Geraldton Port, and therefore bulk exports.
Arrowsmith North has a Total Mineral Resource of 513 MT at 98.0% SiO2, and a Total Ore Reserve of 221 MT at 99.5% SiO2. The company published a bankable feasibility study based on an initial 25-year mine life.
The initial $40m capital expenditure (CapEx) is currently being reviewed to reflect present day costings required to build the 2Mtpa operation, and the project is expected to yield $2.7bn in revenue over the initial 25-year mine life.
Permitting for Arrowsmith North is advanced and, based on current estimates on timing after consultation with the EPA, the final assessment is expected to take place in December 2023. A short construction phase, expected to take six months, will begin soon after final approval, and the project will then begin producing high-grade silica sand for international markets.
The Arrowsmith North Resource area focuses on a prominent broad dune structure and avoids existing infrastructure and potential conservation areas. The potential volume is estimated from the base of drilling to the top of the dune and assumes that between 70% and 100% of the dune is silica sand. The estimate uses an in-situ bulk density of 1.6t/m3 to calculate the tonnage. The initial target grade of +95% SiO2 was considered conservative as all samples, except two, taken from the area exceeded this value and processing demonstrated the in-situ sand can be beneficiated to a saleable product.
All Mineral Resources are reported in accordance with the JORC Code 2012.
Significantly, the Mineral Resource includes an unpredicted 313 million tonnes of white sand at 98.7% SiO2. A high-grade final product can be produced from the higher-grade feed stock which is in demand for the glassmaking, foundry and ceramics industries.
This Mineral Resource estimation allowed the Company to finalise estimates of Ore Reserves to support the Company’s BFS.
The Indicated Mineral Resource is predominately within the Mining Lease application area and the majority is anticipated to convert to Probable Reserves, and hence an extremely long-life mining project.
The Mineral Resource announcement for Arrowsmith North, including JORC Table 1 information, can be found here.
Arrowsmith North Mineral Resource
The Mineral Resource announcement for Arrowsmith North, including JORC Table 1 information, can be found here.
Arrowsmith Brand Silica Sand Project
In addition, VRX has extended its known JORC 2012 compliant Resources in the Arrowsmith area with a new Resource at its new Arrowsmith Brand Silica Sand Project which is contiguous and south of Arrowsmith North and bounded to the south by the Brand Highway road reserve with silica sand similar to Arrowsmith North.
Testwork to date has indicated similar products can be produced utilising some of the infrastructure to be developed at Arrowsmith North. Mining Lease 70/1418 was granted at Arrowsmith Brand on 18 July 2023.
Arrowsmith Brand contains a subset of the previously reported Arrowsmith North mineral resource estimate (MRE). The table below shows the prior Arrowsmith North MRE split between the new Arrowsmith Brand and the Arrowsmith North.
The projects also benefit from adjacent rail lines connecting to ports in Geraldton (Arrowsmith) and Kwinana (Muchea), and by road to the port at Esperance (Boyatup).
Arrowsmith Central
During March 2019 VRX Silica completed an aircore drill program at the Arrowsmith Central Silica Sand Project over the area previously tested only by shallow hand auger drilling. The analytical results were used to update the Mineral Resource Estimate for the Arrowsmith Central Project.
As announced on 15 August 2019, the MRE for the Arrowsmith Central Silica Sand Project was upgraded to 76.5 Mt @ 96.8% SiO2 including an Indicated Resource estimate of 28.2 Mt @ 96.6% SiO2 and an Inferred Resource estimate of 48.3 Mt @ 96.9% SiO2. This was an overall increase of 273% on the maiden estimate.
As announced on 17 September 2019, a Maiden Probable Ore Reserve was declared for the Arrowsmith Central Silica Sand Project of 18.9Mt.
Mineral Resources and Ore Reserves
VRX Silica Limited – Summary of Silica Sand Mineral Resources and Ore Reserves
Mineral Resources – as at 30/06/2023
Ore Reserves – as at 30/06/2023
Material assumptions for Reserve and Resource reporting
The information in this document that relates to the estimation and reporting of the Mineral Resource and Ore Reserves for the Arrowsmith North, Arrowsmith Central and Muchea Silica Sand Projects, and Boyatup Drilling is extracted from releases to ASX on 28 August 2019 and 11 November 2022 (Arrowsmith North), 17 September 2019 (Arrowsmith Central), 9 May 2023 (Arrowsmith Brand), 18 October 2019 (Muchea) and 18 August 2022 (Boyatup). The Company confirms that it is not aware of any new information or data that materially affects the information included in this document and all material assumptions and technical parameters underpinning the estimates continue to apply and have not materially changed.
The Company’s governance and internal controls in place with respect to estimates of mineral resources and ore reserves involve the use of external consultants where required, in conjunction with input by management and review by the Board.
Competent Persons’ Statements
The information in this document that relates to Arrowsmith North, Arrowsmith Brand, Arrowsmith Central, Muchea and Boyatup Exploration Results, and Muchea Aircore Drilling Area, Arrowsmith Brand and Boyatup Mineral Resource Estimates are based on data collected and compiled under the supervision of Mr David Reid BSc (Geology), who is a full-time employee of VRX. Mr Reid is a registered member of the Australian Institute of Geoscientists.
The information in this report that relates to Arrowsmith North Mineral Resources is based on, and fairly reflects, information compiled by Mr David Williams, a Competent Person, who is an employee of CSA Global and a Member of the Australian Institute of Geoscientists.
The information in this document that relates to Arrowsmith Central and Muchea Auger area Mineral Resources is based on information compiled by Mr Grant Louw who was a full-time employee of CSA Global, under the direction and supervision of Dr Andrew Scogings, who is an Associate of CSA Global. Dr Scogings is a Member of the Australasian Institute of Mining and Metallurgy and a Member of the Australian Institute of Geoscientists. He is a Registered Professional Geologist in Industrial Minerals.
The information in this report that relates to Industrial Minerals considerations for Arrowsmith North, Arrowsmith Central and Muchea, with respect to Clause 49 of the JORC Code is based on, and fairly reflects, information compiled by Dr Andrew Scogings.
The information in this document that relates to Arrowsmith Central and Muchea Probable Ore Reserves is based on data collected and compiled under the supervision of Mr David Reid BSc (Geology).
The information in this report that relates to Arrowsmith North metallurgical test work is based on information compiled by Mr Steven Hoban who is the Principal Metallurgist and a Director of BHM Process Consultants. Mr. Hoban is a Member of the Australasian Institute of Mining and Metallurgy.
The information in this announcement that relates to Arrowsmith North Ore Reserves is based on information compiled by Mr Quinton de Klerk, who is employed by Cube Consulting. Mr de Klerk is a fellow of the Australasian Institute of Mining and Metallurgy.
Each of the named persons has sufficient experience relevant to the style of mineralisation and type of deposit under consideration and to the activity which they are undertaking to qualify as Competent Person as defined in the 2012 edition of the Australasian Code for the Reporting of Exploration Results, Mineral Resources, and Ore Reserves (JORC Code). Each of the named persons consents to the disclosure of information in this report in the form and context in which it appears.
