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(Alliance News) - Jangada Mines PLC on Tuesday said its Pitombeiras vanadium project in Brazil has very good potential for becoming a profitable mine following a positive preliminary economic assessment.
Jangada shares surged 21% at 10.20 pence each in London on Tuesday.
The London-based mineral resource miner focused on Brazil said that the assessment confirms that Pitombeiras has "robust economics and excellent potential to become a profitable producer of ferrovanadium concentrate".
The results of the assessment, at the current 5.5 million tonnes of resources, indicate an initial capital expenditure of USD9.5 million for a 1.1 million tonnes per year operation, to deliver a net present value of USD106.5 million, post-tax, and an internal rate of return of over 300%.
"We are very pleased with the results of Pitombeiras' preliminary economic assessment as it defines a project with very robust economics and remarkable potential for further growth, which we expect to demonstrate in the following months upon the conclusion of the current drilling programme and delivery of upgraded and expanded resources as we keep extending Pitombeiras North's orebody footprint," Executive Chair Brian McMaster said.
The company said it also sees a "feasible opportunity to significantly reduce" the initial capital expenditure, which will increase the "already robust" net present value and internal rate of return.
By Greg Roxburgh; gregroxburgh@alliancenews.com
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