Atlas Iron Ltd. (ASX:AGO) announced that its board has approved the development of the Mount Webber Stage 2 project, which is to double production at Mount Webber to 6 million tonnes per year. The new production rate should be achieved by the December 14 quarter.
As quoted in the press release:
Very pleasingly, life of mine operating costs are now expected to be in the range of $49-51 / WMT (on a nominal basis), which represents a significant reduction from the $56 / WMT originally estimated for the Stage 1 project. The extremely competitive operating costs are driven by a strip ratio of 0.3:1, the economies of scale achieved on longer haulage distances and general mining economies of scale. There is potential to reduce these costs further in the future via access to rail.
Atlas is also pleased to advise that the combined stages of the Mt Webber project are estimated to cost an aggregate $212M, inclusive of road upgrades.