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Wednesday, 1 May 2013
Largo Resources says Maracas project on track for Q4 commissioning; Currais Novos placed on care and maintenance
Largo Resources (CVE:LGO) provided late Tuesday an operational update on its vanadium and tungsten projects in Brazil, with the company saying it is confident it will meet its commissioning target of the fourth quarter for its Maracás project.
At Maracás, civil and electrical mechanical construction continues to "progress rapidly", the company told investors in a statement on Tuesday, with the project remaining on budget and on schedule for commissioning at the end of the fourth quarter.
The water pipeline has already been commissioned and has been running continuously since mid-March, while work on the electrical power line is continuing and pre-commissioning remains targeted for August.
The company also said that all key equipment and materials for the crushing circuit have arrived on site and are being installed or prepped for installation.
"We are extremely pleased with the development of construction at the project to date. We have made substantial progress and continue to remain on budget and on schedule," said COO Tim Mann.
The project, which is fully funded, permitted and in construction, is slated to be the world's "premier producer of vanadium", according to the company, due to its high grade and low operating costs. The 27,000-hectare property is located 813 kilometres northeast of Brasilia, the capital of Brazil, and 250 kilometres southwest of Salvador, the capital of Bahia State.
Largo, which is modeling average annual production of 11,400 tonnes of vanadium pentoxide equivalent over a 29-year mine life at Maracas, already has an off-take agreement in place with Glencore International for 100 per cent of material for six years.
At the company's Currais Novos tungsten project in Rio Grande do Norte, Brazil, however, Largo said the situation has "significantly worsened" from late 2012, when a severe drought suspended operations, and as a result, has been forced to place the mine on care and maintenance. The company said the continued lack of rainfall further exacerbated the existing water deficit, preventing normal operations at the project.
"The drought has now extended for 2 years and is a very serious situation for the town of Currais Novos, as well as the surrounding area. Largo continues to examine water supply options while also examining methods of increasing the efficiency of the plant once production resumes," Largo said in its release Tuesday, adding that it will continue optimization work on the site until a return to "more normal rainfall".