A look at VRX Silica’s Arrowsmith and Muchea Project Developments

  • Jun 06, 2019 AEST
  • Team Kalkine
A look at VRX Silica’s Arrowsmith and Muchea Project Developments

Headquartered in Australia, VRX Silica Ltd (ASX: VRX) focusses on meeting the global demand for silica sand. The company identified a silica sand shortage in the Asia-Pacific region in early 2018 that provided a unique opportunity for Western Australia to supply a niche. Silica sand is the essential component in all kinds of glass manufacturing activities. The Asia-Pacific region contributes 47% of global silica sand demand and is expected by the company to grow by 6.1% to 138 mmt in 2019. The company has significant silica sand projects in Western Australia, including high-quality silica sand projects at Arrowsmith and Muchea.

In April this year, the company received strong interest from 20 manufacturers across the Asia-Pacific region for the purchase of significant tonnages of silica sand products from its two Arrowsmith Silica Sand Projects and Muchea Project.

The company’s current silica sand resources are depicted in the table below:

Let us have a look at the recent developments in the two high-quality silica sand projects of the company:

Arrowsmith Silica Sand Project

Located 270km north of Perth in Western Australia, Arrowsmith Silica Sand Project was acquired by VRX Silica in October 2017. The project has considerable capacity for sand suitable for use in both glassmaking and construction. It sits across four granted exploration licences with two mining lease applications and one exploration licence pending. Three areas covered under the Arrowsmith Project includes Arrowsmith North, Arrowsmith Central and Arrowsmith South.

Recently, the company announced the results of test-work and confirmation assays for recoveries of silica sand commercial products from its Arrowsmith Project. The drilling was commenced at the North and Central Arrowsmith Silica Sand Projects in March 2019. The company informed that the following products were recovered from the project:

The aircore drilling was planned to an average of 11.2 metres at Arrowsmith North and 6 metres at Arrowsmith Central. The Arrowsmith North area is prospective for construction sand that can also be improved to glass quality. However, the Arrowsmith Central has potential for limestone and sand.

The company also obtained a cost estimate, independent process design and engineering in March this year for its Arrowsmith Project (North and Central prospects). A global leader in sand mining wet processing plants construction work, CDE Global, undertook the process circuit design, independent processing test-work and engineering. CDE Global has given a cost estimate to VRX Silica for a 2 Mtpa processing plant.

Muchea Silica Sand Project

Comprising of two tenements with 93 sq. km area, Muchea Project is located at 50 km to the north of Perth. The project includes one granted exploration licence, with one mining lease application and one exploration licence pending. A silica sand Mining Lease application (MLA70/1390) was lodged for the project in January 2019, that included 92% of the total Indicated and Inferred Mineral Resource of 191 Mt @ 99.6% SiO2.

Recently, the air core drilling program (planned to an average of 15.6 metres) got completed at the Muchea Project and confirmed high recoveries of commercial silica sand products as indicated in the table below:

The third iteration of test-work on Muchea Silica Sand Project got completed in March 2019 based on which, the circuit design for the processing plant was finalised by CDE Global. The test-work confirmed that the plant design for the manufacturing of a high purity silica sand product apt for the glass-making industry would remain the same for Arrowsmith Central, Arrowsmith North and Muchea Projects.

Stock Performance of VRX Silica

The company’s stock has delivered an outstanding long-term return of 81.95 per cent in the last five years. The stock is currently trading at AUD 0.065 (at 3:39 PM AEST on 6th June 2019).


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