SEATTLE (ITRI.CO.UK): Elementos has completed a significant milestone in the development of its Oropesa project by signing a contract to develop the processing plant.
Elementos, via its local Spanish subsidiary Minas de Estano de Espana, has awarded an Early Contractor Involvement (ECI) contract to local Spanish company Duro Felguera. The contractor specialises in the delivery of Engineering, Procurement, and Construction (EPC) contracts for large industrial projects.
The ECI is split into two phases. In the first stage, Duro Felguera will mature the engineering studies past the level suitable for Elementos’ Definitive Feasibility Study. The contractor will also provide a lump sum cost for completing the EPC delivery of the plant. Around 90% of the final EPC contract has already been agreed.
Once this work has been completed, approved by Elementos’ financiers and government, and a final investment decision has been made, Duro Felguera will deliver the processing plant for the Oropesa project. This stage, however, is not fully binding, which allows Elementos flexibility in case of unforeseen challenges or alternative approaches.
In Elementos‘ Optimisation Study for Oropesa, published in March 2022, the company estimated that the plant would process some 1Mtpa ore. This follows a 20% reduction in mined mass via ore sorting technology and would result in 3,350 tonnes of tin-in-concentrate annually.
ITRI View: Signing a contract with an established EPC delivery company is a boost to the development of the Oropesa project. Managing Director Joe David explained that “the mineral processing plant makes up a large portion of the capital cost of building the Oropesa tin project, and partnering with Duro Felguera significantly de-risks this package”.
The processing plant is likely to comprise more than half (~55-70%) of the projects’ overall capital costs. Under the first stage of the ECI, Duro Felguera will deliver a binding EPC delivery price and contract, which drastically reduces the risk and amount of set aside by Elementos to cover delivery of the plant. Having this cost set, as well as operation and sustaining capital cost estimates provided by Duro Felguera, will make it easier for Elementos to attract project financing.
Courtesy: www. itri.co.uk