This technical report presents the findings of the Hannukainen Feasibility Study for the Hannukainen iron-copper-gold project, Kolari District, Finland, dated January 2014.
Report context
This technical report was prepared for Northland Mines OY in connection with the publication of the Hannukainen Feasibility Study (HFS). The project is located in the Kolari District of Northern Finland, centred on X: 249837, Y: 7498171 using the Finnish National Coordinate System, Projection zone 2. Northland is principally an iron exploration and production company with properties in northern Sweden and Finland. The report describes the results of a review of the HFS, which comprises the exploitation of the Hannukainen iron-copper-gold project. The effective date of the Mineral Resource is 24 October 2012.
Processing route
Metallurgical testwork and geometallurgical model
Metallurgical testwork has been performed in a number of campaigns using a total of 36 metallurgical samples including two pilot plant tests. This testwork has demonstrated that high quality iron and copper concentrate can be produced at the project with the developed flowsheet. A geometallurgical model has been established for the project and has been used in selecting samples for variability and metallurgical testing and for pit optimisation. Variability testing included more than 200 samples. The ore bodies have been classified in terms of metal recovery with respect to iron, copper and sulphur content.
The report states that there is sufficient understanding of the main ore types to be able to define the expected metallurgy and to predict the metallurgical recoveries of iron and copper into saleable magnetite and copper concentrates. Sufficient testwork has been performed to define the metallurgy and the selected process flowsheet is considered to be appropriate for the different ore types at Hannukainen.
Comminution testing
Comminution testing has been completed in laboratory and pilot scale testing. The results have been incorporated into the grinding circuit design.
Selected flowsheet
The selected flowsheet includes two stage grinding using a Semi Autogenous Grinding (SAG) ball mill configuration with flash flotation of fast floating chalcopyrite. Hydrocyclone overflow, nominally 80% minus 90 microns, passes to copper rougher flotation followed by pyrite flotation. The tailings from pyrite flotation are treated by Low Intensity Magnetic Separation (LIMS) to produce a combined magnetic concentrate containing magnetite and pyrrhotite. This magnetic concentrate is cleaned to remove the sulphur bearing pyrrhotite by flotation. Copper concentrate is cleaned in three stages of flotation incorporating a regrind circuit. Final tailings are stored as high and low sulphide tailings in two separate impoundment areas.
Concentrate quality
The magnetite and copper concentrates contain acceptable levels of impurities. Pelletizing characteristics of the magnetite concentrate have been studied by COREM and show that the product has excellent properties.
Recovery functions
Satisfactory recovery functions have been developed for iron in terms of percent iron and percent sulphur levels in the feed and for copper recovery in terms of copper in the feed. The report notes that recovery functions for gold require further work if considered significant in terms of the project economics. These recovery functions represent the projected performance of the latest flowsheet.
Plant engineering
Sufficient engineering has been performed to establish the plant capital cost. The process operating costs assumed for the HFS were estimated from first principles and SRK considers the underlying assumptions and overall costs to be reasonable.
Implementation schedule
The implementation schedule and the plant ramp up time for the project are considered realistic. The report notes that the potential effect of weather windows on the overall schedule should be reassessed if the project start date changes significantly.
Concentrate transport
Concentrate transport for the project will be achieved using two principal methods depending upon the concentrate type being shipped. Approximately 66,500 tpa of copper-gold concentrate will be produced and transported using conventional 60 t heavy goods vehicles with a 40 t payload. The HFS proposes that up to four trucks per day will be required. Several potential destinations exist for this concentrate within Sweden and Finland including facilities at Gällivare (Sweden), Skellefteå (Sweden) or Harjavalta (Finland).
Iron concentrate will be shipped using rail transportation from the Rautuvaara rail head to ports in Sweden or Finland. The HFS base case for iron concentrate transportation is from the Rautuvaara rail head to the Port of Kokkola (approximately 520 km south of Rautuvaara) by train. The system developed comprises several discrete components: warehouse/stockpiles at Rautuvaara; reinstated Rautuvaara-Kolari rail line; existing Kolari-Kokkola rail line; Port of Kokkola; and ocean going vessels for shipment to customers.
The costs presented give a total transportation cost of USD17.75 per tonne ore shipped to the port of Kokkola including rail transportation, port operations and project management.
Key reported parameters
| Parameter | Units | Design / Proposed | Testwork Basis | Notes |
|---|---|---|---|---|
| Total Measured and Indicated Resource (combined open pit and underground) | Mt | 187 | Resource estimate | Effective date 24 October 2012 |
| Total Inferred Resource (combined open pit and underground) | Mt | 63 | Resource estimate | |
| Open pit Measured and Indicated Resource grade | % Fe Total | 30.06 | ||
| Open pit Measured and Indicated Resource grade | % Cu | 0.18 | ||
| Open pit Measured and Indicated Resource grade | g/t Au | 0.112 | ||
| Total Proven Mineral Reserve | Mt | 113.7 | ||
| Total Probable Mineral Reserve | Mt | 1.1 | ||
| Total Mineral Reserve grade | % Fe | 30.5 | ||
| Total Mineral Reserve grade | % Cu | 0.185 | ||
| Total Mineral Reserve grade | g/t Au | 0.112 | ||
| Total Mineral Reserve grade | % S | 2.4 | ||
| Combined RoM ore (LOM) | Mt | 114.8 | Design schedule | |
| Combined waste (LOM) | Mt | 446.8 | Design schedule | |
| Strip ratio (LOM) | W:O | 3.9 | Design schedule | |
| Maximum annual throughput | Mtpa | 6.5 | Design | Combined maximum |
| Iron recovery | % | 65 | Projected performance | For latest flowsheet |
| Copper recovery | % | 84 | Projected performance | |
| Gold recovery | % | 26 | Projected performance | |
| Mass yield (magnetite concentrate) | % | 29 | Projected performance | |
| Magnetite concentrate grade | % Fe | 70 | Projected performance | |
| Copper-gold concentrate grade | % Cu | 25 | Projected performance | |
| Copper-gold concentrate grade | g/t Au | 7.1 | Projected performance | |
| Concentrate tonnage (magnetite, dry, LOM) | Mt | 32.8 | Design projection | |
| Concentrate tonnage (Cu/Au, dry, LOM) | Mt | 0.72 | Design projection | |
| Pre-contingency total capital expenditure | USD million | 736 | Cost estimate | |
| Capital contingency | % | 10 | Assumption | |
| Total capital expenditure (including contingency) | USD million | 810 | Cost estimate | |
| Operating cost contingency | % | 5 | Assumption | |
| Mining unit operating cost | USD/t moved | 2.00 | Estimate | LoM average |
| Processing unit operating cost | USD/t milled | 6.79 | Estimate | |
| Total operating expenditure (pre-contingency) | USD/t milled | 24.02 | Estimate | |
| Discount rate (base case) | % | 8 | Assumption | Post-tax, pre-finance |
| Post-tax NPV (8% discount rate) | USD million | 248 | Financial model | SRK derived |
Project website: https://en.wikipedia.org/wiki/Northland_Resources
Technical qualifications
The report notes that recovery functions for gold require further work if considered significant in terms of the project economics.
The report recommends that metallurgical recovery parameters for copper and gold should be verified, noting these have remained unchanged since March 2011.
The process flowsheet, recovery functions, and operating and capital cost estimates are based on feasibility study level engineering and testwork. The report states the implementation schedule and plant ramp up time are considered realistic, but that the potential effect of weather windows on the overall schedule should be reassessed if the project start date changes significantly.
The report includes recommendations for further technical studies during the detailed engineering phase, including re-evaluation of pit and waste dump designs for larger truck sizes, additional metallurgical testwork, and verification of recovery parameters.
The report notes that sufficient testwork has been performed to define the metallurgy and that the selected process flowsheet is considered to be appropriate for the different ore types at Hannukainen, but that recovery functions for gold require further work if considered significant.
Source: Hannukainen Technical Report, January 2014, Executive Summary sections 1.4 and 1.5, and related technical content.
