Australian Securities Exchange Notice
Iluka Resources Limited · ABN 34 008 675 018 · Level 23 140 St Georges Terrace Perth WA 6000
GPO Box U1988 Perth WA 6845 · T: +61 8 9360 4700 · F: +61 8 9360 4777 · www.iluka.com
19 November 2009
JACINTH-AMBROSIA COMMENCES PRODUCTION
ILUKA'S MAJOR PROJECT EXECUTION PHASE COMPLETED
Iluka Resources Limited ("Iluka") advises that its Jacinth-Ambrosia project, located in the
Eucla Basin, South Australia has achieved first production of heavy mineral concentrate
("HMC").
The project has been completed ahead of schedule, with capital expenditure expected to
be less than $390 million, compared with an approved budget of $420 million
.
Completion of the Jacinth-Ambrosia project brings into production a long life, globally
significant, zircon rich mineral sands mine and, in combination with the completion of the
Murray Basin Stage 2 project in Victoria, sees the conclusion of Iluka's current major
project execution and capital expenditure programme.
Following their ramp-up periods, these two projects will represent the majority of the
company's zircon and rutile production output from mid 2010.
Mr David Robb, Iluka's Managing Director stated: "The achievement of sustained first
HMC production at Jacinth-Ambrosia is a major milestone for Iluka and for global zircon
supply. This achievement significantly reduces risks associated with both project execution
and balance sheet capacity for the company."
"At the same time, completion of both projects consolidates Iluka's position as not only a
major supplier of titanium dioxide feedstocks internationally but also as the principal
supplier of zircon, the medium term demand characteristics for both of which are positive,
especially in developing and urbanising economies."
"I would like to acknowledge the efforts of the project team and all our contractors in
achieving such an excellent outcome. Project execution in a remote part of South
Australia has been achieved five years after the initial exploration discovery, without a
"lost time" injury and without any breaches of environmental licence conditions. The
assistance of the South Australian Government, at both a Cabinet and departmental level,
in facilitating the completion of this development, the first in a mixed use reserve area of
the State, is gratefully acknowledged."
The Jacinth and Ambrosia mineral sands deposits were discovered by Iluka in the second
half of 2004. The unique characteristic of Jacinth-Ambrosia is its combination of size and
high zircon assemblage, with the deposits together having a combined zircon assemblage
of 50 per cent. This high zircon assemblage, relatively low capital expenditure to develop
and the higher price typically received for zircon compared with titanium dioxide products
,
should ensure that Jacinth-Ambrosia is competitively positioned. Over its ten year plus
economic life Jacinth-Ambrosia is expected to produce approximately 2.8 million tonnes of
zircon, 350 thousand tonnes of rutile and 1.5 million tonnes of ilmenite (predominantly
1
Zircon prices have averaged approximately 1.2 times rutile prices and 6 times chloride
ilmenite prices over the period 2001-2007.
chloride grade). Initial Jacinth-Ambrosia production will replace production from Iluka's
Western Australian operations, which was reduced materially in 2009.
Iluka has 50 thousand square kilometres of exploration tenements in the Eucla Basin and
is committing the main part of its exploration expenditure to further extending its resource
position in this area.
The development of the Jacinth-Ambrosia project has been subject to comprehensive
environmental management planning controls and has involved extensive community
consultation including a Native Title Agreement with the Far West Coast people. Iluka is
most appreciative of the broad based support it has received from the regional community,
including residents and Councillors of the Shire of Ceduna.
Investment market and media inquiries
Dr Robert Porter
General Manager, Investor Relations and Corporate Affairs
Phone: + 61 8 9360 4751
Mobile: +61 (0) 407 391 829
Email:
Refer associated Iluka Mineral Sands Briefing Paper which includes additional information on
Jacinth-Ambrosia as well as comments from David Robb, Managing Director, on industry dynamics.
This briefing paper also includes details of Iluka's updated currency hedging positions.
Print Entire Page
