Canadian explorer Cornish Metals has completed an updated preliminary economic assessment (PEA) for its South Crofty tin project, in Cornwall, UK, confirming robust economics for what could become the first primary tin mine in Europe or North America in decades.

The study outlines an after-tax net present value (NPV), using a 6% discount, of £180-million ($235-million) and an internal rate of return of 20%. Average all-in sustaining costs are forecast at $14 500/t of payable tin over the life-of-mine (LoM), well below current market prices of about $35 000/t. This places South Crofty in the lowest quartile of the industry cost curve, with a projected 62% earnings before interest, taxes, depreciation and amortisation (Ebitda) margin during steady-state operations.

Pre-production capital is estimated at £198-million, with payback in 3.3 years and average yearly Ebitda of £70-million in the first five years of full production. The PEA is based on the existing NationaI Instrument 43-101 mineral resource, dated September 6, 2023, and supports a 14-year LoM, with further resource upside expected.

According to the PEA, South Crofty will mine 5.9-million tonnes of ore grading 0.94% tin over 14 years, producing about 49 000 t of tin, 3 842 t of copper and 3 223 t of zinc. Average yearly tin output is forecast at 4 700 t between years two and six, equivalent to about 1.6% of global mined tin supply.

Cornish Metals accelerated development following its £57-million fundraise earlier this year, which attracted cornerstone backing from the UK’s National Wealth Fund and further investment from Sir Mick Davis’ Vision Blue Resources. The company has since reinforced its leadership team with experienced mine builders and operators, while also engaging top-tier consultants including Technical Management Group and Worley to align South Crofty with international best practice.

Cornish Metals CEO Don Turvey said the updated study underlined the quality of the resource and the strength of the project’s fundamentals.

“Completion of the project review and updated study marks another important step for South Crofty as we advance towards first tin production by mid-2028. We are delighted with the attractive economics that the project offers and, once in operation, we expect South Crofty to be a long life, lowest quartile cost producer, and highly cash generative, with Ebitda margins in excess of 60%,” he stated.

“The project continues to be supported by robust economics with an increased NPV and a short payback period of only 3.3 years. Additionally, the upside potential through further mineral resource expansion is material, as evidenced by the mine’s historical record of consistently replacing mined tonnes and adding to the resource base, a trend that we expect will be replicated once we are in a position to start an underground near-mine drilling programme on commencement of underground development.”

UPSIDE POTENTIAL
South Crofty has a long record of replacing mined tonnes and extending its mine life, a trend Cornish Metals plans to continue once underground development resumes. The project’s exploration target points to additional mineralisation of between 6-million and 13-million tonnes grading 0.5% to 1.8% tin, with higher-grade extensions identified.

Turvey said the company believed the existing resource, which underpinned the current 14-year mine plan, represented only a fraction of the broader South Crofty system.

“We believe that the current South Crofty mineral resource, which constrains the current study’s 14-year mine life, is only a small deposit within a much broader tin system in the South Crofty mining permission area that will support a multigenerational asset, as it was once before,” he said.

South Crofty, once the last operating mine in Cornwall before its closure in 1998, is set to play a pivotal role in the UK government’s critical minerals strategy. The project is permitted through to 2071, with full approvals in place for construction of the processing plant. It benefits from existing underground infrastructure and will operate using 100% renewable power, with potential for on-site renewable generation.

“South Crofty was the last mine in the region to close, and we are proud to be on the cusp of making it the first to re-open, producing tin, a critical mineral that is essential to the green economy,” said Turvey. “The project is effectively already in construction with major works underway including the shaft and pump station refurbishment, construction of the workshop and stores building, process plant site excavation and critical site utilities.”

He added that the project had strong support from the community and government. “South Crofty remains a flagship project within the UK government’s Critical Minerals Strategy. The company benefits from direct investment and strong strategic support from the UK government, alongside backing from leading industry partners in the critical minerals space.”

The project is expected to create over 300 direct jobs and a further 1 000 indirect jobs, with an on-site training centre planned to upskill local workers.