Tectonic Resources is holding talks with Chinese parties about funding for its $145 million, potentially wind-powered Phillips River copper and gold project near Ravensthorpe in Western Australia.
Managing director Jason Stirbinskis said the Perth-based company also planned to change its name to Phillips River Ltd, effective October, because the market associated Tectonic Resources with the now mothballed Rav 8 nickel mine, also near Ravensthorpe.
The area is best known for the Ravensthorpe nickel laterite mine, formerly held by BHP Billiton and currently slated for re-opening by Canada’s First Quantum Minerals.
Mr Stirbinskis said the Phillips River project, which also contains silver, lead and zinc, could be in production by mid-2013. In the meantime, a substantial amount of capital must be raised, talks with potential customers pursued and a decision made on whether it is feasible to use wind power at the Phillips River project.
“We probably need to make a decision by the end of the year, but in terms of environmental studies, it’s all done,” Mr Stirbinskis told a media briefing in Perth on Monday.
He said the funding package would likely comprise about $40 million to $50 million in conventional debt, about $30 million in subordinated debt through an offtake partner and the remainder in equity. The company would soon meet with potential funders in Hong Kong and mainland China, he said.
Whether they were prepared to back a hybrid wind/diesel power side project at Phillips River was yet to be seen, Mr Stirbinskis said.
The company is seeking to obtain more than 50 per cent of the project’s power from wind and is not aware of any mine in the world that is substantially wind-powered.
A grant under the federal government’s Renewable Energy Fund would be sought, but another option was to join forces with nearby spodumene miner Galaxy Resources, Mr Stirbinskis said.
“We have the potential to demonstrate that a mining company can be both green and productive.”
Tectonic shares closed 0.2 cents lower at five cents.
