Business
Expansion
Expansion.
About this update from Ferrexpo Plc
[{"type":"text","content":"\n Ferrexpo PLC\n22 November 2007\n\n\n\n\nExpansion of Existing Operations beyond IPO Business Plan\n\n\nFerrexpo plc ('Ferrexpo') is pleased to announce the commencement of a US$158\nmillion project to expand production at its current mining operation on the\nGorishne - Plavninskoye Lavrikovskoye ('GPL') deposit to approximately 32mt of\niron ore per annum by 2011 and to extend the life of the mine at these\nproduction levels to at least 2035. This additional ore production will enable\nthe Company to take advantage of currently under-utilised processing capacity to\nincrease high quality pellet production by approximately 1.3mt per annum. This\nproduction expansion and extension of mine life are in addition to that detailed\nin the business plan associated with Ferrexpo's listing in June.\n\nAs foreshadowed at the time of the listing, a GPL pit optimisation study has\nbeen undertaken by Ferrexpo in conjunction with Turgis Consulting (Proprietary)\nLimited ('Turgis'), the Company's South Africa-based mining engineering partner,\nwhich has determined that it is possible to increase production of iron ore at\nthe GPL mine from current production levels of approximately 28mt per annum to\nat least 32mt per annum. The design of the pit expansion is such that the\nincremental ore mined will consist entirely of richer ore, all of which will be\nused to produce Ferrexpo's higher quality pellets containing 65% Fe. This\nadditional ore will be processed through the existing beneficiation and\npelletising plants, which have surplus capacity, enabling capital efficient\npellet production expansion to be achieved. Once full ore production is reached\nin the GPL pit, it is expected that pellet production levels from produced ore\nwill be increased by about 1.3mt per annum of 65% Fe pellets.\n\nThe Board of Ferrexpo PLC has approved US$158 million in development capital\nexpenditure for this project. US$68 million will be spent on capitalised\nstripping works over the next 3 years, to be implemented immediately to the\nnorth of the of the current pit operations. Most of the remainder will be spent\non additional mining equipment.\n\nThe engineering design work carried out on the GPL open pit has determined that\nthe mine life can be extended at the expanded production levels by at least 12\nyears, to 2035. SRK Consulting and Turgis have bee...