Diatreme Resources (ASX:DRX) has released an Economic Impact Assessment (EIA) for its Northern Silica Project (NSP) in Far North Queensland, with the assessment completed by KPMG estimating the project will increase Queensland's real Gross State Product by $2.53 billion and lift real household consumption by $729 million over the proposed 25-year mine life.

Key Points

  • EIA completed by KPMG estimates a net benefit to Queensland of $412.6 million in present value (7% NPV) terms, with a benefit-cost ratio of 4.1
  • Up to 214 jobs during construction and 128 direct operational roles over the 25-year mine life, with a 50% Indigenous employment target
  • Estimated life-of-mine contributions of $305 million in Queensland state royalties and Native Title payments, and $2.1 billion in company income tax
  • Construction scheduled to commence in Q4 2028, with Phase 1 operations planned for Q2 2030 and potential expansion to 5 Mtpa from 2032

EIA Scope and Assessment Process

The EIA was commissioned by Diatreme and completed by KPMG as part of the NSP's Environmental Impact Statement (EIS), which is being assessed under the bilateral assessment process between the Queensland and Australian governments. The EIA is based on the NSP's Pre-Feasibility Study economic assessment, announced on 15 October 2026, and reflects the project's updated development timeframes, the preferred delivery model of shared use of existing wharf and shiploading infrastructure at the Port of Cape Flattery, and updated environmental management, monitoring and emissions costs. Dollar figures are in real 2026 Australian dollars and present values use a 7% real discount rate.

Northern Silica Project Infrastructure and Production Plan

The proposed NSP is a greenfield open-cut silica sand mine, processing facility and associated export infrastructure located approximately 30 kilometres north of Hope Vale in the Hope Vale Aboriginal Shire, within the Cape Flattery to Cape Bedford silica mineral province. The project has a proposed 25-year mine life, producing 3 Mtpa of silica sand product in Years 1 and 2 (Phase 1), potentially expanding to 5 Mtpa from Year 3 (Phase 2), for a total of 121 million tonnes of product. ROM sand will be mined progressively and processed via an on-site wet concentration plant, with final product delivered by conveyor to the Port of Cape Flattery for export, subject to a Full-User arrangement with Ports North and CFSM or a similar commercial agreement.

Employment and Community Benefit Projections

According to the filing, the project includes a 50% Indigenous employment target alongside a focus on local training and procurement directed at the Hope Vale and Cooktown communities. The NSP has been recognised as a Major Project by the federal government and a Coordinated Project by Queensland. Diatreme's partner in the project is Sibelco. The project site includes an on-site accommodation village, solar and diesel power generation, an on-site borefield and water recycling system, with mined areas to be progressively rehabilitated to native vegetation. All construction commencement and operational timelines remain subject to final approvals.