Highlights
- VRX Silica has executed a letter of intent (LOI) with ResourcesWA to explore a proposed power supply solution for the company’s Arrowsmith North Silica Sand Project.
- Under the LOI, the company will analyse the potential to set up a powerhouse, with containerised gas reciprocating engines, at a nearby gas wellhead site.
VRX Silica Limited (ASX:VRX) has executed a letter of intent (LOI) with ResourcesWA to explore a proposed power supply solution over a period of six months for the company’s Arrowsmith North Silica Sand Project by use of gas directly from a local wellhead.
The LOI has been signed with the prime objective of analysing the potential to set up a powerhouse, with containerised gas reciprocating engines, at a nearby gas wellhead site with direct offtake from a current gas plant and reticulation to the Arrowsmith North site through a dedicated transmission line.
Data source: Company update dated 07 March 2023
A snapshot of Arrowsmith North Silica Sand Project
One of the company’s most advanced project, the Arrowsmith North Silica Sand Project has a Total Ore Reserve of 223 MT at 99.7% SiO2 and Total Mineral Resource of 771 MT at 98.0% SiO2.
Situated next to the Brand Highway and Geraldton-Eneabba railway and ~270km north of Perth, Arrowsmith North allows a direct link to the Geraldton Port, and consequently, opens way for bulk exports.
A bankable feasibility study was conducted for the project on the basis of the first 25-year mine life. A modest AU$40 million capital expenditure (CapEx) will be needed to establish the 2Mtpa operation. Once functional, the project is likely to yield AU$2.7 billion in revenue over the first 25 years, reports VRX.
The production is scheduled to take place this year.
VRX shares were trading at AU$0.115 on 07 March 2023.