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[July 2002]
Iluka Commits to a Further Expansion of its USA Operations
The board of Iluka Resources Ltd (Perth, WA, Australia) has approved an expansion of the company's USA mining and processing operations into northern Florida and southern Georgia. This move represents an investment of approximately US$36 million and will replace production of ilmenite, rutile and zircon from the Green Cove Springs dredging operation, commencing in 2003.The Atlantic Basin remains a key strategic focus area for Iluka in terms of both future development and growth opportunities. The project is the company's second significant investment in its USA mineral sands business in the past 13 months. Iluka has recently commissioned a US$23 million upgrade to its Old Hickory operation in Virginia which will increase the production from the operation by 50%.
The Florida/Georgia project provides an attractive low risk return while allowing the company to maintain growth and development options in a highly prospective region close to existing markets.
The project involves deferring the decommissioning of the dredge concentrator at the Green Cove Springs mine site from March 2003 to mid-2003 and the relocation of the mobile concentrator in January 2003 to an adjacent lease area where it will continue to operate until June 2005.
It will also require a new 1,000 tonne per hour concentrator/mining unit and associated infrastructure to develop the Georgia deposits. The new unit will be initially located at the Lulaton deposit with commissioning scheduled for June 2003. The concentrator, mining units and associated equipment will be a modular design for transportation on state roads from one deposit to another. The design will enable the units to be transported both within the USA or any part of the world. The processing plant at Green Cove Springs will also require modifications to accommodate the relocation of the new concentrator to the South Brunswick deposit in early 2005.
Based on current reserve estimates, a combined mine life of more than 10 years is anticipated. This will be sufficient to meet Iluka's long-term contractual commitments and provide additional production for sale in the US market. The company is in the process of proving up several other deposits in the region to further extend mine life in the area.
In addition, Iluka has an extensive exploration programme underway which, if successful, could underpin further regional expansion projects.
ENDS