Vox Royalty (TSX-V:VOX) Corp said the Western Australian Department of Mines, Industry Regulation and Safety (DMIRS) has approved an amended mining proposal to expand the annual production rate at the Wonmunna Iron Ore Mine operated by ASX-listed producer Mineral Resources Limited (MinRes).
The proposal, submitted by MinRes in February 2022, seeks to expand the annual production rate at Wonmunna from 10 million tonnes per annum (Mtpa) to 13.5 Mtpa, a significant increase from the current 5 Mtpa production rate.
The approval was granted on June 29, 2022, said Vox, a returns-focused precious metals royalty company.
READ: Vox Royalty highlights 33% ore tonnage upgrade at its Binduli North gold project in development and exploration update
Vox holds an uncapped 1.25%-1.50% gross revenue royalty over Wonmunna, which forms a key part of MinRes' 11 million tonnes per annum (Mtpa) Utah Point Hub operations in the Pilbara region.
"The ability for Wonmunna production to be expanded without significant additional capital intensity was a key attribute which attracted us to this royalty, as demonstrated by the recently approved February 2022 mining proposal,” Riaan Esterhuizen, Vox executive vice president for Australia said in a statement.
“MinRes' uniquely integrated miner/contractor business model puts it in a strong position to deliver the increased production tonnage set out in its latest proposal, and we are excited about the potential royalty returns for the company over the coming years," Esterhuizen added.
Current mining at Wonmunna involves the extraction of iron ore from three Marra Mamba Iron Formation-hosted deposits across multiple shallow open pits ranging from 20 metres (m) to 50m in depth.
The mine plan and throughputs are based on an average grade of 57.5% iron and production of 3 Mtpa of ore, which Vox believes was achieved in 2021. Based on MinRes' March 2021 mining proposal, Vox expects production throughput will further increase to over 5 Mtpa in 2022.
Established in 2014, Vox has a portfolio of over 50 royalties and streams spanning eight jurisdictions.
Contact the author at jon.hopkins@proactiveinvestors.com