And from the creation of Iluka in 1998, the company was
reliant on Eneabba for its zircon supply. This lasted until
2006, when a combination of deposit depletion and declining
grades meant, for Iluka, the beginning of the end of the
importance of the West.
The company’s geographic center
shifted to the Murray Basin, in Australia’s
south-eastern state of Victoria. But it has more recently
shifted again to the company’s Jacinth
Ambrosia deposit in the Eucla Basin in South Australia.
Jacinth Ambrosia came online in 2009 at the tail end of
declining global zircon supply, which gave it a strong
global economic situation during a period of steady growth
in zircon demand.
Jacinth Ambrosia produced 151,000 tonnes of zircon in
its first year, and doubled this in the following year. A
production increase in 2011 coincided with record high
zircon prices, exceeding $2,000 per tonne and approaching
$3,000 per tonne.
The soaring prices were blamed on increased Chinese
demand, static global supply, and a lack of new projects
that was blamed on the difficulty of finding funds.
Zircon supply switched from deficit to surplus some time
in late 2011, following end-use substitution and thrifting.
This change in global supply and demand fundamentals would
mean that output from Jacinth Ambrosia would fall below
2010 levels, to just under 140,000 tonnes of zircon.
But as zircon prices stabilized after 2013, supply from
Jacinth Ambrosia increased, and so did the
deposit’s significance. Meanwhile, the Murray
Basin’s zircon output was already falling
before 2015, and that year mining operations were closed,
and stockpiles began to be drawn down.
Despite a 20-month idling of the Jacinth Ambrosia
deposit between April 2016 and December 2017, output has
remained a high proportion of the company’s
It was estimated by TZMI and Iluka Resources, in the
latter’s presentation on May 17 this year, at
the Bank of America Merrill Lynch conference in Miami, that
global zircon supply was around 1.2 million tonnes in 2017.
This means that Jacinth Ambrosia accounted for nearly 18%
of global supply (213,500 tonnes), and about 70% of
Iluka’s total zircon output that year (a
further 100 tonnes of zircon was produced across the whole
Today, Jacinth Ambrosia’s role in
Iluka’s business is as important as ever. In
the company’s 2018 annual report, it described
it as the world’s largest zircon mine, and
outlined plans to increase throughput by about 30% to
offset any decline in ore grades, such as those experienced
in Eneabba earlier in the company’s life.
Plans for expansion at Jacinth Ambrosia, at a cost of
A$40 million ($30.49 million), include the installation of
a second mining unit to increase the amount of ore pulled
out of the ground, as well as an upgrade for the wet
concentrator plant, where ore is first processed.
The expansion will allow the company to keep up with
current global demand, with a definitive feasibility study
due in mid-2018, and project completion due in 2019.
Jacinth Ambrosia is made up of two parts of a continuous
deposit. Mining is set to commence at the Ambrosia side of
the mine, and will progress alongside the Jacinth side of
the mine for several years beginning in 2019. This is
likely to further increase zircon production, but it must
be noted that overall production is limited by the amount
of processing capacity that the project possesses.
The company also hopes that the addition of its Western
Australian Cataby mine in the first half of 2019 will also
help to alleviate some supply tightness. The mine is set to
produce an average of 50,000 tonnes per year of zircon,
which is some way short of the 200,000-300,000 tpy that
Jacinth Ambrosia can produce.
Cataby and Jacinth Ambrosia are key projects for Iluka
if it wishes to maintain its zircon market share, and they
are major components of Iluka’s broad strategy
to mitigating extreme price increases for zircon.
Iluka is also planning to exlarge its operations in
Sierra Leone, with expansions at its Lanti Dry and Gangama
deposits, as well as a proposed new mine at Sembehun.
Commissioning of both expansions is planned for 2019, while
the new mine at Sembehun is planned for a commissioning
date of 2021.
These operations have historically been insignificant in
terms of zircon production, however, with just 3,000 tonnes
of zircon produced in 2017.
Simarily, Iluka’s exploration in Sri Lanka
is focused on sulfate ilmenite production. Here, work is
currently being undertaken in technical and community
And Iluka continues to explore in Canada, targeting
deposits rich in rutile and ilmenite, in conjunction with
|Can Kazakhstan be the
next Murray Basin?
Perhaps more important for Iluka’s
future zircon production than its operations in
Australia is the exploration taking place in northern
Kazakhstan for 'WIM style deposits’. WIM
deposits are characterized by low-grades and high
volumes, and are typically fine-grained.
WIM deposits also exist extensively in
Australia’s Murray Basin, where they
have yet to be exploited.
While their coarse-grain strand-line counterparts
have been developed by both Cristal Mining and Iluka
in the past, fine-grain deposits have yet to be
economically extracted due to technological
limitations in processing and separating
But recent research into fine-grain deposits, such as
that carried out by Klingner and Standing in 2016,
and Bruckard in 2015, suggest that fine-grain Murray
Basin WIM deposits can be processed to +20 μm. In
the Murray Basin, fine-grained material (20-38 μm)
contains more than 40% ZrO2 and CeO2 (assumed to be
contained in zircon and monazite,
It may be this relationship that Iluka is looking for
in Kazakhstan, where the company boasts 76,192 square
kilometers of exploration licenses, with programs
currently being headed by experienced mining engineer
Iluka commenced its first major drilling program in
2017 and, pending successful laboratory analyses, a
targeted drilling campaign may take place later this