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MINING | AGUIA RESOURCES
AGUIA
RESOURCES
Domestic phosphate supply for Brazil’s agricultural juggernaut
ASX-listed Aguia Resources is primarily focused on advancing its phosphate assets in Southern Brazil, along with a copper exploration portfolio in the same region. The company’s corporate office is in Sydney but its highly experienced in-country team in Porto Alegre is intent on delivering high quality phosphate mines that will supply Brazil’s colossal agriculture sector with the key fertiliser product. Since Dr Fernando Tallarico was promoted from technical director to managing director last October, Aguia has made significant technical progress at its flagship Três Estradas phosphate deposit, obtaining a preliminary licence (LP) and redesigning the entire project in a new scoping study. “On the corporate level we have restructured the company in many ways resulting in a much leaner structure that will help us be more cost-efficient,” Tallarico tells RGN. “My primary task now is to work towards the granting of the installation licence (LI), which will allow us to start construction of our phosphate mine and processing plant.”
The Três Estradas project is
Despite possessing a thriving
located in Rio Grande do Sul -
farming industry, there are no
Brazil’s Southernmost state with
active phosphate mines in Rio
an area of about 292,000 km²,
Grande and it is 100% reliant on
of which 203,000 km² is arable
imports of fertiliser products
and active in the production of
which are so crucial to the high
soybean and rice crops.
level of agricultural output in the state.
In fact, Rio Grande is the third largest agricultural producer in
Aguia plans to change this
the country having produced
on the way to becoming the
about 35 million tonnes (Mt) of
only local producer in the
grains in the 2018/2019 harvest,
region after making a series
and it is the second biggest
of greenfield phosphate
producer of grains per hectare
discoveries in Rio Grande over
in Brazil.
the last decade.
MINING | AGUIA RESOURCES
“Our flagship project Três
then around 30,000 metres of
“Following this, we went
Estradas is in the central zone
diamond, reverse circulation
through a sequence of
of the state and is surrounded
and auger driller has been
metallurgical testing followed
by very productive farms and
conducted, mostly by Rede
by economic assessments of
crops. Within a 300 km radius
Engenharia e Sondagen –
the project.
from the project there is a
an extremely well-known
demand of 245,000 tonnes per
company in the Brazilian
“Then we conducted all
year of P2O5 nutrient, which
mining industry.
the baseline studies and
is equivalent to 2.5 Mt of fertiliser grading 10% P2O5.”
environmental assessment This work has resulted in
of the project area and this
the delineation of a JORC-
resulted in the granting of the
Aguia drilled the first
compliant resource of 105
LP in October,” says Tallarico.
exploration hole in the Três
Mt, of which 83 Mt at 4.11%
While the environmental
Estradas carbonatite in
P2O5 is in the measured
permit applications were being
September 2011 and since
and indicated categories.
prepared, Aguia was also busy
redesigning the downstream elements of the project.
Overhauling the project The company overhauled its existing bankable feasibility study, which called for a column flotation circuit that would have involved the construction of a water dam and a tailings dam, opting instead for a direct application natural fertiliser (DANF) product. “When we decided to produce DANF, the processing became extremely simple as it only includes a comminution plant with no water used in the
hectares, with 60 hectares of
The first phase of the study
process and no tailings being
open pit area.
will deliver a post-tax NPV
generated. Thus, we were able
of around $45 million with
to eliminate both the water
The DANF plan informed
an IRR of 51% and a quick
dam and the tailings dam.”
a new scoping study for
payback period of 3.3. years.
Três Estradas conducted
Aguia envisages a three-phase
This single move succeeded
by independent Brazilian
development for the long-life
in bringing down the project’s
consulting firm GE21
project, with the DANF Phase
capex from US$75 million
Consultoria Mineral. The study
1 focused on mining high-
to around $7 million and
was published in February
grade oxidised material from
will reduce the size of the
and highlighted the strong
surface down to a depth of 30-
processing plant and other
economics of the project.
40 metres.
facilities of the mine by 77% to an optimised area of 93
MINING | AGUIA RESOURCES
have to be stored in the tailings dam and then progressively be reclaimed and sold to the market over time in Phase 3.”
The copper opportunity When Aguia first started working in the central area of Rio Grande its focus was on the yet-to-be explored phosphate opportunities in the region, but after establishing first mover advantage in the fledgling phosphate sector, the company began to consider exploration for other commodities, particularly copper. “After 18 years of mining
concentrate grading at least
The prolific Rio Grande
and exhausting the oxidised
30% P2O5. This will generate
Copper Belt is a well-known
material, the fresh carbonatite
tailings composed essentially
geological trend with many
will be exposed and can
of carbonate minerals that
projects in development along
be then mined in Phase 2,
were characterised as a high
with existing mines and one
depending on the economic
quality agricultural lime
depleted copper mine that
constraints at that time.”
(aglime), used to correct the
happened to be in the same
acidity of the soils.
area that Aguia was exploring
Tallarico explains that mining
for phosphate.
fresh carbonatite will require
“Because the volume of aglime
a column flotation plant that
tailings produced in Phase 2 is
Already with two exploration
will produce a phosrock
very high, we expect that about
field offices in the region,
two thirds of these tailings will
Aguia subsequently took
advantage of its position and
From these targets, Aguia has
the main copper mineral in
staked 52 tenements, acquiring
defined an inferred mineral
Andrade is chalcocite, which
eight for a total of 86,187
resource of 10.8 Mt with an
carries about 80% copper
hectares within the Rio Grande
average copper grade of 0.56%
and offers the possibility of
Copper Belt.
and 2.56 g/t of silver for the
developing a low capital cost
Andrade project, and proven
project of open pit mining and
“Over the past three years we
a high grade zone surrounded
processing via heap leach,
were able to consolidate a
by a lower grade envelope
followed by the crystallisation
district scale position with 860
through modelling and recent
of copper sulfate.
km2 of granted exploration
drilling.
permits, that include six
In addition, copper sulphate is
extremely prospective targets
More recently, the company
widely used in Rio Grande by
with copper mineralisation at
has looked into the option of
farmers as a pesticide and for
surface,� says Tallarico.
producing copper sulphate as
treating copper deficient soils, so copper sulphate production
MINING | AGUIA RESOURCES
could open up another
information should inform an
revenue stream for Aguia in
initial economic assessment.”
the regional agriculture sector.
Next steps
At Três Estradas, Aguia will push towards the next stage
“For the next year at Andrade,
of permitting in the next 12
we need to continue drilling
months, which is the granting
and expanding the high-grade
of the LI – the permit that will
core zone. By doing this we
allow the company to start
will improve the overall grade
construction of the mine site.
and tonnage of the resource. In parallel we want to run the
“To achieve this we have
initial leaching tests with our
to work in four different
material to understand how
areas along the year: 1:
exactly it will perform. This
Environmental plans and
“Over the past three years we were able to consolidate a district scale position with 860 km2 of granted exploration permits, that include six extremely prospective targets with copper mineralisation at surface” - Dr Fernando Tallarico manager director, Aguia Resources
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programmes, 2: Detailed
April from the Development
engineering of Phase 1 -
Bank of Southern Brazil for a
DANF, 3: Permitting with the
development loan to fund up
National Mining Agency and
to 50% of the capex for Três
4: Secure the use of the land,
Estradas.
via acquisition or possession agreements.”
All the stepping stones are in place for Aguia to progress
In parallel, agronomic
its long-term phosphate
efficiency tests are ongoing
project in the next few
with the DANF product applied
years, underpinned by open
to key crops as soybean,
attitudes to mining in Brazil
rice, maize and ryegrass.
and its position as a global
On the financing side, Aguia
agricultural powerhouse.
received a letter of support in
“Our flagship project Três Estradas is in the central zone of the state and is surrounded by very productive farms and crops. Within a 300 km radius from the project there is a demand of 245,000 tonnes per year of P2O5 nutrient”
MINING | AGUIA RESOURCES
“Projections for 2028/29 are for a grain harvest of around 300 Mt in Brazil - an increase of about 27% from the current production, at a growth rate of 2.4% per year. To support this growing production without encouraging deforestation, the only solution is the intensive use of fertilisers,” says Tallarico. With a strong portfolio of phosphate projects in Rio Grande and 10 years of incountry operation under its belt, Aguia is well-positioned to take advantage of these favourable conditions for fertiliser production in Brazil.
AGUIA RESOURCES AT A G L A N C E
STOCK TICKER ASX:AGR
MARKET CAPITALISATION
US$17.5 million (As of April 22, 2020)
a
Published by Anderson Murray Media Ltd
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