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SAREIC PREVIEW

Rex to sing from Hillside again

The market has barely heard
from Rex Minerals Ltd over
the last two years but managing

director Richard Laufmann has

assured investors the company

has not been hiding. Rather, it has

been doing the work needed to

ensure its Hillside project is more

robust second time round.

Hillside – on South Australia’s

Yorke Peninsula – was vaunted as

among the strongest of an emerg-

ing crop of IOCG projects during

a boom period for the State in Before and after shots of the Hillside copper-gold project on the Yorke Peninsula. Following the

2008-2012 however, there were resource drill out, Rex rehabilitated the land and three full crop seasons have since been enjoyed

major hurdles to negotiate includ-

ing a small but vociferous community op- thing major but the Government informed opportunity to stop the project early. But I

position group and the tailing off of the us that we needed to submit a new de- am confident. I attend all public meetings

commodities boom. tailed plan; one which was consistent and have developed a good rapport with

The company had chosen to expand and conformed to the original mining li- the opponents.”

the scope of the project in a 2012 PFS cence,” Laufmann said. “I have to admit Rex has largely withdrawn from the

but the subsequent fall in iron ore and that process took as long as the feasibil- market during the revision process, a

copper prices left Rex in the unenviable ity study work.” deliberate move according to Laufmann.

positon of having to resubmit its mining There is no doubt Rex has been cau- “We have not been out to the invest-

licence application in the face of contin- tious in putting together its revised plan ment community with the repackaged

ued community opposition. and PEPR. Laufmann said given the project yet,” he said. “We will have quite

“We certainly fell out of bed,” admitted community concerns, the company had a good story to tell but wanted to make

Laufmann last month. “The big change requested an extended period to submit sure it was shovel-ready with no commu-

was the iron ore price; the project had the PEPR. nity or regulatory concerns around it be-

started to configure around iron ore but “We now have until September to com- fore we did go out. When we’re finished

that meant adding capex to the build just plete it,” he said. “Most of the concerns the submission we will revisit the invest-

as the price began falling.” are around the procedures we will have ment proposal with shareholders and re-

Rex took the decision to revert to a in place for things such as dust, noise, start financing discussions.”

copper-gold mining scenario, choosing vibration and traffic management. It is The company’s strategy suggests late

to forego magnetite production in order quite a significant piece of documenta- 2017 as a date for marketing to kick in

to strip 9 mtpa from the operation’s ca- tion and I think we’ve raised the bar again and that timing could also prove benefi-

pacity, thus reducing capex, opex and with the quality.” cial from a macro perspective with Lauf-

the mine’s footprint. The postponement of Hillside’s devel- mann confident copper is beginning to

“We went to ground to produce a ro- opment coincided with BHP Billiton Ltd’s regain traction.

bust, old-school feasibility study where decision not to proceed with the Olympic “The smart money is starting to look at

we were not trying to push the envelope,” Dam expansion and Laufmann believes the copper space and there are not many

Laufmann said. Rex was caught up in the subsequent development projects around,” he said. “I

The extended feasibility study, re- backlash in SA. think this is going to be a great story sec-

leased in May 2015, envisaged Rex “It came as a shock to government and ond time round.”

mining 24% of the 337mt @ 0.6% cop- community, especially because it was The extended feasibility study placed

per and 0.14 g/t gold resource and pro- being fast-tracked and we have had a job a $480 million price tag on Hillside’s de-

cessing it through a 6 mtpa plant with the winning back respect in the community,” velopment and Laufmann said Rex was

iron ore pre-crushed and stored at the Laufmann said. “In these cases changes keen to pursue opportunities to reduce

Hillside tailings facility for potential future to the plan immediately raise suspicion. its contribution to the capex.

processing. If we were already operating, the com- “Everything is on the table; we are

Rex was confident the study made munity wouldn’t be so sceptical but the not going to hold onto this project. If we

Hillside ready for development once cop- changes back to the original plan have need a JV or a bigger player in, that’s

per hit $US3/lb – a price it hasn’t been meant we have had to take time reinvest- what we’ll do. An outright sale doesn’t

at since November 2015 – but following ing in the relationship with the commu- make any sense but it reducing the bite

release of the extended feasibility study, nity.” we take does make sense. There aren’t

the SA Government informed the com- Similarly, the company’s impending many copper stories around and some of

pany it would have to resubmit its mining resubmission has stirred up another hor- the venture funds are very interested in

licence and approved programme for en- net’s nest. copper long term.”

vironment protection and rehabilitation. “The small group of opponents took it – Dominic Piper
“We thought it was just a different stag- as an opportunity for a victory dance and

ing of the project and wouldn’t need any- are now viewing the resubmission as an

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