A new study on the proposed Ardmore phosphate operation confirms its profitability, with a forecast gross revenue of almost $1.5 billion and net cash flow of $429 million, Centrex Metals says.

The company has released an updated definitive feasibility study on the North West Queensland project, expected to cost $78.47 million to bring into production and have a pay-back period of less than two years.

In an announcement to ASX, Centrex said the updated DFS provided it with confidence to commence project financing discussions and progress product sales.

“It’s the right project at the right time,” chief executive officer Robert Mencel said.

“We have an opportunity to help Australian farmers produce more food, do it in a more environmentally friendly and sustainable way and at the same time provide a decent return to shareholders.“

Related: Short mining campaign underway at Ardmore

The study indicates a project Net Present Value (NPV) of $207 million, with gross revenue of $1.453 billion, totals costs reaching $965 million and free cash of $429 million.

Mine life of 10 years

The mining and processing operation would run for about 10 years, with forecast annual production of 800,000 wet tonnes.

Centrex is continuing optimisation studies with a view to improving the project’s value.

These include-
* Investigating value-adding opportunities to the Direct Application Phosphate Rock (DAPR)
product. These include package sizing options and microbial inoculant treatments.
* The use of reverse flotation to increase reserves, simplify mining and create a premium +37 per cent
P2O5 product.
* Optimising the commercial plant’s location. With potentially 100 per cent of what is processed to be sold, Centrex says the project isn’t sensitive to the plant’s location. Alternative plant locations may result in
lower capital and operating costs.
* Potential bulk road haulage, rail and storage solutions to significantly reduce logistics costs.
* By-product value-adding opportunities. Potentially the by-product could be used to create a high-phosphorus low-cost soil conditioners and as an input into animal feeds.

Centrex in 2019 completed on-site assembly of a 70-tonne-per-hour start-up plant (pictured below), before putting the brakes on the project.