Element 25 Limited (ASX: E25) has taken a critical step forward with its plans to develop the Butcherbird Manganese Mine in Western Australia with the signing of a key Access Agreement with the remaining stakeholder in relation to the granting of mining lease application M52/1074.
The lease application, which covers the planned mining and infrastructure areas for the proposed development, is between the company and the owner of the Bulloo Downs Pastoral Lease, Chandra Ridley. The Agreement sets a framework for a mutually beneficial relationship by providing for Ms Ridley to take advantage of appropriate contracting opportunities, contains certain milestone cash payments as well as setting up a cooperative framework to foster a strong working relationship going forward.
Managing Director Justin Brown said the signing of this Agreement is the final milestone required for the mining lease application to be granted which will pave the way for the submission of mining approval documentation to the WA Department of Mines, Industry Regulation and Safety in relation to the company’s planned manganese ore production at the Butcherbird Project.
E25 is very pleased to be able to report this important milestone in what we hope will be a long and mutually beneficial relationship,” Mr Brown said.
“Importantly, it paves the way for the grant of a Mining Lease over the planned production area and is a critical development step for E25”.
Mr Brown said the Butcherbird Manganese Project is a world class manganese resource with current JORC resources in excess of 263 Mt of manganese ore.
The company has recently completed a Pre-Feasibility Study with respect to developing the deposit to produce manganese concentrate for export to generate early cashflow with a modest capital requirement.
Mr Brown said the outstanding economics and low capital hurdle of less than A$15 million will allow the company to develop the project in a shorter timeframe than would have otherwise been possible.
This is envisaged as the first stage of a staged ramp up for the project and has the advantage of potentially providing early cashflow to strengthen the company’s balance sheet and assist in funding of the larger high purity manganese production hub which is the subject of a parallel, complimentary work stream.
The Project straddles the Great Northern Highway and the Goldfields Gas Pipeline providing turnkey logistics and energy solutions. The company is also intending to integrate renewable energy into the power solution to minimise the carbon intensity of the Project as well as reducing energy costs. A cleaner, lower carbon flowsheet and high penetration renewable energy will place Butcherbird at the forefront of sustainable metal production.