Sulphur Springs Project Starts Underground Decline, Targets A$523m+ NPV Boost

Project Progress and Strategic Approach

Develop Global Limited (ASX: DVP) has marked a pivotal milestone at its Sulphur Springs zinc-copper project in Western Australia’s Pilbara region by commencing substantial earthworks. These include the construction of the boxcut for the underground decline and clearing the site for processing plant infrastructure. This early capital development strategy, mirroring the successful approach at the Woodlawn mine in New South Wales, aims to significantly de-risk the project and position it for higher productivity.

The underground decline is scheduled to begin excavation in the December 2025 quarter, enabling Develop to confirm construction and funding forecasts ahead of production. This proactive approach is designed to reduce operational risks by completing critical underground infrastructure well before mining activities commence.

Financial Outlook and Updated Feasibility Study

The Sulphur Springs project’s June 2023 definitive feasibility study (DFS) outlined a robust pre-tax net present value (NPV) of A$523 million, based on a 1.25 million tonne per annum underground mine. The project forecasts life-of-mine revenue of approximately A$2.9 billion and free cash flow of A$745 million, with an expected mine life of eight years post-construction.

Since that DFS, commodity prices for copper, zinc, and silver have risen substantially, while treatment and refining costs have decreased industry-wide. These factors are expected to enhance the project’s financial returns and will be incorporated into the updated DFS due in December 2025. Develop also anticipates a roughly 20% increase in ore production tonnages through a bottom-up mining approach, which will further improve project economics.

Operational and Community Engagement

Earthmoving activities have progressed with the removal of the oxide layer at the boxcut and reinstatement of site access routes. Develop is working closely with the Nyamal Traditional Owner Group and contractors such as Youngs Earthmoving and Develop Mining Services Pty Ltd to ensure smooth project advancement. The underground decline and ventilation access drives will extend approximately 350 metres below surface, targeting the bottom of the known orebody.

Develop’s Managing Director, Bill Beament, emphasized the strategic value of the upfront underground development, noting it will unlock potential gains in mine life and productivity while providing more flexible financing options. The approach also allows for additional underground drilling, which could expand the project’s resources and reserves.

Looking Ahead

With the project fully permitted and significant groundwork underway, Develop is positioning Sulphur Springs as a low-cost, high-return operation. The updated DFS will be a critical next step, incorporating recent market improvements and operational insights. Investors will be watching closely to see how these developments translate into revised financial forecasts and project timelines.