Robust unveils study of Romang Island Mn project, signs smelter MoU

By Ruli Setiawan

ASX-listed Robust Resources Limited announced Wednesday the results of a recently completed scoping study of the Romang Island Manganese (Mn) project in Maluku Province, which confirms the viability of the project.

?The Romang Mn Project, despite being small-scale and short production life (2-3 years), is commercially attractive with strong financial returns and no fatal flaws,? concluded the study carried out by independent consultant Equant Resources Pty Ltd.

Other key findings of the study are as follows:

CAPITAL COST	US$8 ? 10 million
OPERATING COST	US$42 ? 50 per ton of Mn product
PRODUCTION	250,000 t/a Mn Product for 2-3 years
Mn PRICE (>42% Mn)	US$3.5 ? 4.5 / mtu (20% discount to market)
GROSS MARGIN	US$100 ? 140 / t Mn product US$25 ? 35 million per year
PAYBACK	< 6 months
GROSS REVENUE	US$50 ? 100 million

The key risks identified in the study are environmental risks due to metal contamination (both at Romang site and in customer applications) and political risks associated with restrictions on Mn ore export by Indonesian government laws and regulations.

Based on the positive outcome of the Scoping Study, Robust has commenced work on a feasibility study of the Romang Manganese project, which is scheduled for completion by October 2014. The study costs approximately A$1.2 million.

In mitigation of one of the key risks identified in the scoping study, Robust, through its Indonesian subsidiary PT Gemala Borneo Utama signed a Memorandum of Understanding (MOU) with the Indonesian subsidiary of Asia Mineral Corporation (AMC) who have submitted proposals and carried out ground-breaking on a manganese smelter industrial complex on the island of West Timor, which is in close proximity to Romang Island.

The MOU is designed to provide flexibility for the company to potentially export high-grade ore in the early years of Mn production with a progressive transition to supply of the AMC smelters in the later years of the project.

Robust continues to make progress in defining new areas of high-grade Mn mineralization, the company said.

Robust Managing Director, Gary Lewis comments; ?I am pleased to be able to provide an update on the progress we have made on our Romang Island Manganese project, which, whilst not the main value driver, is an important part of our strategy for an early, low-cost entry into production. The positive Manganese Scoping Study, MOU with AMC and recent drilling results all point to the potential viability of the Mn project and this will be confirmed in a feasibility study that has already commenced, and due for completion later this year.?

Editing by Reiner Simanjuntak