Cadence Minerals upgraded Mineral Resource Estimate provides the Board with great confidence

Cadence Minerals plc (LON:KDNC) has provided an update on the ongoing Pre-Feasibility Study at its flagship Amapa Iron Ore Project. 

Amapa is a substantial integrated mine, beneficiation plant, railway and port in the northeast of Brazil. It was previously owned by Anglo American (70%) and Cliffs (30%) and  at its peak produced up to 6.1 million tonnes of iron ore concentrate per year.


·     Cadence have now acquired 27% of the Amapa Project, which is being fast-tracked through development and eventually to production.

·     PFS commissioning based on producing 5.3 Mt per annum, 4.9Mt is anticipated to be a 65% iron ore concentrate.

·     Wardell Armstrong International Ltd, a leading, globally recognised mining consultancy, has been appointed the PFS Manager of the Amapa Project.

·     Work is on track to deliver a high-quality PFS for the Amapa Project

Cadence CEO, Kiran Morzaria, commented: “The Amapa Mine has all the attributes of a significant iron ore deposit, and the upgraded Mineral Resource Estimate of 176.7m tonnes grading 39.7% Fe at the Inferred category provides the Cadence board with great confidence in our investment decision.”

“As we see the world move towards decarbonisation and as manufacturers seek to minimise their carbon footprint, the planned production of a >65% Fe concentrate utlising predominantly renewable energy really does highlight the potential for the Amapa mine, rail and port infrastructure to deliver a lower emission iron ore product to our customers.”

“Completion of the PFS will be an important step towards unlocking the value of this deposit and I look forward to providing progress updates in the coming weeks.”

Amapa Pre Feasibility Study and Wardell Armstrong Appointment

The Pre Feasibility Study (“PFS”) began on the Amapa Project late last year and is based on producing 5.3 Mt of iron ore concentrate per annum. We expect to produce 4.9Mt of the higher quality, lower carbon footprint 65% iron ore concentrate which, as of the date of this announcement, trades at approximately US$170 per dry tonne.

The PFS contemplates refurbishing and rehabilitating the existing port, rail and plant with modifications being made to the beneficiation plant to achieve a larger portion of 65% iron concentrate (4.9 Mt). In addition, an investigation is underway into optimisation opportunities and potential cost savings in the transportation of the iron ore concentrate, particularly in the areas of transhipment and movement of ore from the mine to the rail loadout.

Previous studies carried out by SRK consulting based on 2015 site visits and updated in 2019 to reflect changes in inflation and foreign exchange rates estimated the total level of capital expenditure for the project of approximately US$168.8 million (scoping study level accuracy). The same study estimated operating expenditure of about US$ 24 per dry tonne delivered free onboard from Amapa’s port in Santana, Brazil.

All the other areas within the PFS are progressing as expected, with work underway on all critical areas, including mining, beneficiation, infrastructure, energy, tailings storage facilities, logistics and sales and marketing.

Cadence is also pleased to announce that it has appointed Wardell Armstrong International Ltd (“WAI”) as PFS manager for the Amapa Project. WAI is a leading, globally recognised mining consultancy with a track record of conducting all levels of technical study required on projects that have successfully been financed and developed into full mining operations.

WAI are working closely with all our consultants to deliver the lowest cost and capital expenditure possible, which represent huge advantages for any mining operation, particularly for construction and project financing.

About the Amapa Project

Amapa commenced operations in December 2007 with the first production of iron ore concentrate product of 712 kt in 2008. In 2008 Anglo American (70%) and Cliffs (30%) acquired the Amapa Project in 2008 as part of a larger package of mining assets in Brazil.

Production steadily increased to 4.8 Mt and 6.1 Mt of iron ore concentrate product in 2011 and 2012. During this period, Anglo American reported operating profits from its 70% ownership in the Amapa Project of US$ 120 million (100% US$ 171 million) and US$ 54 million (100% US$ 77 million). Before its sale in 2012, Anglo American valued its 70% stake in the Amapa Project at US$ 866 million (100% US$ 1.2 billion). It impaired the asset in its 2012 Annual Accounts to US$ 462 million (100% US$ 660 million).

Cadence updated the Mineral Resource Estimate on November 2nd 2020, increasing the MRE by 21%. The current MRE contains a Mineral Resource of 176.7 million tonnes grading 39.7% Fe in the Indicated category and Mineral Resource of 8.7Mt at 36.9% in the Inferred category, both reported within an optimised pit shell and using a cut-off grade of 25% Fe.

Details of Ownership and Joint Venture Agreement

Cadence owns 27% of the Amapa Project, with our joint venture partner, Indo Sino Pty Ltd (“Indo Sino”), owning the remaining 73%. The ownership of Amapa is via a joint venture company, Pedra Branca Alliance Pte. Ltd., which owns 100% of the equity of DEV Mineração S.A. (“DEV”). Should Indo Sino seek further investors or an investment in the JV Co, Cadence has a first right of refusal to increase its stake to 49%. If Cadence does not exercise its right of first refusal under the terms, Indo Sino will have a twelve-month option to buy the shares in JV Co held by Cadence for 1.5 times the price paid by Cadence Minerals for such shares.

Click to view all articles for the EPIC:
Or click to view the full company profile:
Share on facebook
Share on twitter
Share on linkedin
Cadence Minerals

More articles like this

Cadence Minerals plc

Understanding the market dynamics of lithium prices

Lithium-ion, a key component in electric vehicles has seen a lot of fluctuation in market prices, which have dropped to CNY 2,05,000-2,46,000 a tonne, versus the highs of CNY 6,00,000 witnessed in November 2022. Lithium carbonate prices rose

Cadence Minerals plc

Iron ore up on China stimulus bets

Dalian iron ore futures extended gains on Tuesday on hopes of additional policy support for China’s economy, but the challenging outlook for the world’s top steel producer weighed on the steelmaking ingredient’s benchmark price in Singapore. The most-traded

Cadence Minerals plc

The underbelly of electric vehicles

While electric vehicles are essential to reducing carbon emissions, their production can exact a significant human and environmental cost. To run, EVs require six times the mineral input, by weight, of conventional vehicles. These minerals, including cobalt, nickel,

Cadence Minerals plc

Lithium key element for electric vehicle ramp up

WHAT IS LITHIUM? The silvery-white element is the lightest metal and highly reactive, giving it strong energy storage potential per unit of weight. This makes the alkali metal the mainstream choice for EV batteries, where high energy density

Cadence Minerals plc

Iron ore edges up

Dalian and Singapore iron ore futures slightly rebounded on Thursday as the market expected downstream steel demand to gradually recover after the latest wave of inclement weather that has constrained construction activities. The most-traded September iron ore futures

Cadence Minerals plc

Iron ore snaps losing streak

Dalian and Singapore iron ore futures rebounded on Monday from oversold levels, although traders’ disappointment particularly over tepid demand for construction steel products in China capped gains. Benchmark prices of the steelmaking ingredient slumped last week, hitting the

Cadence Minerals

Iron ore futures edge higher

Dalian iron ore futures edged higher on Tuesday, with the benchmark contract hitting a record high, as the steelmaking ingredient tracked buoyant steel prices in China, though regulatory concerns limited gains. Sentiment was propelled by improved demand prospects

Cadence Minerals

Iron ore climbs on improving downstream demand

Dalian and Singapore iron ore futures rose on Tuesday, as warmer weather raised expectations for a pickup in steel demand and the market focused on improving consumption fundamentals. The most-traded May iron ore contract on China’s Dalian Commodity

Cadence Minerals

Lithium, a key commodity for automakers

After decades of subdued interest in lithium, rapidly rising demand and prices have made “white gold” one of the hottest sectors in the mining world. Batteries are a foundational technology in the transition away from fossil fuels. And

Cadence Minerals

Iron ore price jumps on China data

Iron ore futures jumped on Wednesday, as better-than-expected China manufacturing activity data raised hopes for a demand rebound in the world’s top steel producer. The most-traded May iron ore futures contract on the Dalian Commodity Exchange (DCE) ended

Cadence Minerals

Iron ore being pushed higher

The spot price of iron ore is being pushed higher in a pincer move of stronger Chinese demand and lower supply from the world’s two biggest exporters of the steel raw material. The spot price of benchmark 62%

Cadence Minerals

Global demand for lithium batteries to leap five-fold by 2030

Global demand for lithium batteries is expected to surge more than five-fold by 2030, public-private alliance Li-Bridge said on Wednesday, as more people opt for electric vehicles and energy storage systems. Demand for lithium batteries in the United

No more posts to show