Nov 09, 2020

Clear Logistics in fresh Cape York mining push

Clear Logistics in fresh Cape York mining push Bauxite loading at Hey Point, where operations are due to restart in 2021.

Clear Logistics Australia is planning to restart mining at its Hey Point bauxite mine on Cape York in 2021, to be joined by a second bauxite operation in 2022.

The private company has entered an agreement with Metallica Minerals to buy its subsidiary company Oresome Australia – which holds 50 per cent of the Urquhart bauxite joint venture project near Weipa.

Clear Logistics operations manager Krysten Roberts said the company hoped to have the two bauxite sites working in tandem within two years, producing about 1Mtpa.

Hey Point has seen two stints of mining since 2016 but is not currently in production.

Mr Roberts said the company would be recruiting for a restart in the new year. Workers for the bauxite mines would be sourced locally and as FIFO from Cairns.

Clear Logistics Australia also completed the acquisition this year of Oresome Minerals’ interested in the Urquhart Point Heavy Mineral Sands (HMS) plant and tenements for $1.7 million.

Mr Roberts said the company had mined a high-grade section of that project, resulting in two shipments mid-year with a total of 70,000 tonnes of ilmenite.

It is looking to set up a spiral separator at the site in early to mid-2021 to exploit the remainder of the HMS deposit.

Mr Roberts said the business expected to produce about 200,000 tonnes of ilmenite over a 12-month operation.

It was likely to be recruiting in March/April for that operation, he said.

The company expects to employ about 36 people across the Cape York operations.

“Clear Logistics Australia is a small company but we have a lot of potential to become a medium-sized company,” Mr Roberts said.

Buying into the Urquhart bauxite joint venture is costing Clear Logistics $100,000 initially plus a milestone payment of $100,000 upon the shipment of the first 1 million dry tonnes and an additional $100,000 upon shipment of the second 1 million dry tonnes of bauxite from the tenement. Royalties will also be paid.

In an ASX announcement last week, Metallica executive chairman Theo Psaros said the offer from Clear Logistics Australia had been superior to other potential offers.

“The decision to sell Oresome was not taken lightly,” he said.

“In addition to the tough bauxite market conditions, we are of the strong view that to continue using shareholder funds to maintain the 50 per cent share during such uncertain bauxite market conditions is not in the company’s interest.

“We are encouraged with the progress of our Cape Flattery silica sands project and subject to finalisation of the Traditional Land Owner
agreements, we expect to be drilling in the near future.”