The Darren Gordon-led developer reported that tests on Jambreiro iron ore confirmed the potential to produce a direct reduction pellet feed product with an iron grade of 67.8% and with 1.73% combined silica and alumina.
According to Centaurus, silica and alumina levels lowers than 2% can be converted to direct reduction pellets for use as a primary ingredient in steelmaking technology that emits considerably less carbon dioxide compared to traditional blast furnaces.
As Gordon put it when the company first flagged its plans to explore this kind of product development in March, the result could be an iron ore product that’s “robust through any price cycle”.
In fact, Centaurus said DRP feed product sells at a premium of between 15% and 30% over the benchmark 62% CFR China Index price in light of an increasing global focus on ‘greener’ steel production.
“The company has already seen a marked change in the way steel producers and iron ore majors are looking at the iron ore sector and low-emission iron products, with strong interest already being shown in the ability of the Jambreiro Project to produce a DR quality pellet feed product,” Gordon said in an announcement to investors on Wednesday.
Centaurus kicked off 2024 with around A$34.7 million in the bank.
When Centaurus first studied the project back in 2012 and 2013, it was looking to maximise the coarseness of the iron ore to create a ‘sinter feed’ product in light of the then-prevailing market conditions.
However, the company now claims the Jambreiro ore lends itself “perfectly” to a finer high-grade product with low impurities, and it can achieve this with just some minor changes to its 2019 PFS flowsheet.
Centaurus will now look to assess the impact of these flowsheet changes to its cost estimates — work which it expects to complete before the end of June.
Earlier work on the project was put on hold following the 2014 iron ore market crash.
Centaurus is proving itself to be nothing if not adaptable; it’s shifted strategy on the fly in response market sentiment and severe disruptions over the years.
Most recently, amid what could be a structural reset of the nickel sector, Centaurus adjusted its development plans at the Jaguar project in Brazil to build a lower-capital nickel sulphide concentrator.
Previously, it was looking at building a downstream nickel sulphate refinery, but this would come with a much higher development price tag — something Centaurus wasn’t willing to support as nickel prices tumbled.
