Development Philosophy

Lodestone has a development philosophy that is encapsulated in the statement - “Start Small - Expand Rapidly”

 

Maximum use of existing physical and social infrastructure will contribute greatly to the practical realisation of this philosophy.

 

In this way we can limit our initial capital needs and set up the structures for continuing, responsible development of the Braemar Iron Formation.

Assets

The company has over 1 billion tonnes confirmed JORC resources. The project is located in South Australia and carries Government support for development. This project is very attractive as the Iron ore concentrate product will be amongst the highest available in Australia at 70% Fe. The standard Pilbara region offer is 58 to 62%. Lodestone concentrate will attract a premium price of currently approx. USD$115 per tonne (US$20 higher than 62%Fe sinter fines). The quality of this concentrate product makes it attractive to all global steel makers.

 

The ore body outcrops at the surface and is hosted within soft rock with an average magnetite content of 25%; this together with the introduction of “Dry grinding technology” from Germany, will result in significantly reduced capital and operating costs, with reduced reliance upon water for processing, unlike all other market competitors.

 

The mine is well situated with access to abundant transport infrastructure connecting to South Australian port facilities and with an available experienced local workforce nearby.

 

Starting small at 1.5 million tonnes per annum, this project will be ramped up to approximately 25 million tonnes over the initial years of the mine’s operation. As an indication of the demand for the high quality of the concentrate, the company holds Letters of Intent from customers covering over 20 million tonnes per annum.

 

The process flow sheet and other innovations will ensure a lower total capital cost for the total project, the majority of this is for processing equipment and plant costs. These items attract Foreign Export Finance from the offshore equipment manufacturers. As a result, the finance risk is greatly reduced. To date we have expended over AUD$35 million on iron ore projects in South Australia.

 

The management team is very experienced with multiple years in mining and iron ore processing operations. The team members have a track record of establishing many large scale ore mining operations.

 

The company is seeking investment in tranches to complete Feasibility Studies and to commence to establish the mine and production by mid 2022.

 

Rewards Strategy - The primary aim of the enterprise is to generate strong positive cash flow to support the region and the enterprise and strong dividends that repay the initial investment many times over. Of course private share sales are always possible too. Rewards via a trade sale pursuant to attractive offers, will always be evaluated by the board but is not the primary aim of the board.

Supporting the Pastoral Industry and Rural Communities

Lodestone Directors lifelong experience developing projects in harmony with all stakeholders, understand the importance of caring for the community and industries in our sphere of operations. Lodestone will always support the local community and industries and has already initiated several activities toward this end. These include:

 

Engaging local pastoralists to assist in roadworks, drilling support and rehabilitation works.

 

Undertaking charity events, and recently raising nearly $30,000 for the Royal Flying Doctor through benefit dinners, with funds to go to the local area including the RFDS clinic on the pastoral station close to our Olary Creek operations.

 

Buying locally to support the business of the area, this includes drill consumables, food and supplies from Broken Hill and fuel supplies for drilling operations coming from Jamestown.

 

Initial planning is also underway in Broken Hill and Port Pirie and surrounding areas to link disability support services with proven programs at city universities.

Protecting Aboriginal Heritage

Consultation with traditional owners and land councils is an integral part of the process of addressing Aboriginal heritage issues and concerns.


We must protect that Aboriginal heritage. The project team will work with the local Aboriginal community and with known databases to identify sites of interest and take necessary steps to protect cultural and heritage sites. Lodestone also at all times seeks to maximise employment opportunities for people’s of aboriginal heritage.

Air Quality

The Olary Flats Project will use the best available methods and technologies to minimise air emissions during construction and when operational.

 

A key air quality impact is dust produced from earth-moving activities during construction, and the movement of vehicles along unsealed roads and tracks during dry conditions. The extent of the dust will vary, depending upon moisture, soil type and the current wind conditions.

 

The magnetite concentrates will always be stored in covered storage to obviate any fugitive dust from the port operations. As the concentrates will contain a minimum of 10.0%  water, little or no fugitive dust is anticipated during ship loading.

 

In addition to dust there will be some exhaust emission from machinery used in construction of the facility and operations. The Port may also generate small exhaust emissions from motors on the facility.

Port operations may generate backup power and may have a diesel or LPG powered generator. This is likely to produce small amounts of exhaust emissions.

Emissions from vehicles and machinery (diesel or LPG) will be emitted during operations. These emissions are expected to be limited as only machinery for use at the maintenance and operations base and small service vehicles are expected to be needed during the operational phase of the project.

Environment and Biodiversity

Biodiversity is the variety of all living things; the different plants, animals and microorganisms, the genetic information they contain and the ecosystems they form. Maintaining ecological biodiversity will be a key consideration for Lodestone. The environmental assessment will outline how we propose to manage potential impacts on plants and animals. The project area has avoided areas of known conservation significance, endangered ecological communities and areas known to be home to threatened species thereby minimising the impacts on plants and animals’ diversity.

 

Communication with government, regulatory agencies and community stakeholders will be an important part of the process of addressing biodiversity issues in the environmental assessment.

 

In areas where the project's footprint is within cleared agricultural land where there is little remnant native vegetation to be found the project is expected to have a minimal impact on ecological biodiversity.

Extensive vegetation cover exists in some areas. Other areas have been heavily grazed by sheep and goats. Detailed field studies will be required to both confirm the existing vegetation mapping and investigate areas where detailed ecosystem information is not available.

The project team will aim to avoid as far as possible all known ecologically sensitive areas, endangered ecological communities and traveling stock routes containing remnant vegetation. In situations where avoiding these areas is not possible, a range of measures to reduce impacts will be put into practice.

During construction, plant matter will be kept in the construction area, unless contaminated with noxious weeds. Wherever possible this material will be spread back over the area after construction to stabilise the ground and support the re-establishment of local vegetation.

After construction has finished easements will be reinstated. Key landscape features and natural drainage lines will be restored as close to original forms as possible and any measures put in place to reduce erosion would remain until enough vegetation has grown to keep the soil stable.

 

Such measures may include:

  • Minimise clearing of native vegetation as much as possible by effective planning of construction activities and location of construction access tracks

  • Introduce soil, weed and water management practices

  • Introduce procedures to protect native animals

Employment Opportunities

The Lodestone Project team is investigating ways to maximise employment opportunities for the local community. The project is moving from a concept stage to the Definitive Feasibility Study stage. Hence a greater understanding of the needs for the project is being developed. All positions will be advertised within the community.

Safety

Safety is a critical component of the construction and operation of the project. The Lodestone project team will consider the risks and hazards that could potentially affect the community and construction crews during the construction and operation of the project.


The project will be designed and constructed according to the relevant guidelines for each component of the project. Potential risks and hazards that could affect the project and human safety will be considered and identified through a comprehensive risk assessment.

Nurturing the Earth

Lodestone embraces its environmental and social responsibilities as an essential part of the business and its interactions with all of its stakeholders. Lodestone is committed to the implementation of innovative practices throughout all facets of our organisation, taking genuine care for the environment, and the community and responsibly husbanding of the earths resources.

 

The project undertook workshops in the concept phase to determine what ideas could be brought to the project that enhanced the overall project, for further investigation.

Further ideas will be sought from the local community and stakeholder as the project is progressed.

 

Some examples of the ideas from the project teams’ workshop included:

  • Creating habitat within the offshore operating zone

  • Revegetating linear infrastructure corridors with native vegetation where possible

  • Sourcing power from the local wind farm as appropriate to the Project’s needs

  • Installation of solar panels as appropriate to the Project’s needs

  • Rain harvesting where feasible

  • Water minimisation strategies - dry processing - tailings paste thickening, filtering and dry stack co-disposal

  • Continual community engagement

 

These initiatives will be integrated into the project's development plans as the project advances.

Water Resources

Surface and Ground water are vital resources to South Australia and the region in which Lodestone operates.
Potable Surface and Groundwater will not be used for industrial purposes in this project. All water requirements for processing minerals will be met by pumping saline ground water or sea water to the production centres. Any water discharged to the environment will be retained within managed residue storage facilities and evaporated. Waste salt will be retained in the residue storage facilities. Strict controls will be implemented to ensure that groundwater and surface water resources are not impacted by saline water.


The project construction and operations phases will be subject to strict controls to ensure that no unintentional releases impact groundwater or surface water. The project will also be the subject of regulatory oversight to ensure these requirements are met.

Land Access and Easements

The Lodestone project team will be contacting each landholder along the proposed route of any linear infrastructure (Roads, Pipelines [water, slurry, gas], Power Lines, Rail) to discuss the nature of the project and as required, to seek access for studies and to help determine an optimal route. Braemar Infrastructure will discuss route options and an easement with landholders where in is proposed that the liner infrastructure crosses properties. Preferred routes will be further refined as the project moves forward.

A precautionary approach will be taken to define route study areas. This means that the routes will be designed to avoid risks of serious or irreversible environmental damage with a preference to run through already disturbed areas and use existing rights of way.

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PO Box 7108
Hutt Street South Australia 5000

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