01/12/2020 - 14:30

Sandfire approves Botswana mine

01/12/2020 - 14:30


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Perth-based Sandfire Resources is spending $371 million to develop a copper-silver mine in Botswana, with production expected in early 2023.

Sandfire approves Botswana mine
Karl Simich says the T3 deposit will be central in Sandfire’s Motheo production hub.

Perth-based Sandfire Resources is spending $371 million to develop a copper-silver mine in Botswana, with production expected in early 2023.

A definitive feasibility study recently completed for the Motheo mine has confirmed a 3.2 million tonnes per annum operation from the project’s T3 open pit.

The DFS outlined an initial 12.5-year mine life, supported by an updated ore reserve of 39.9mt at 0.9 per cent copper and 12.2 grams per tonne of silver for 360,000t of contained copper and 15.6 million ounces of contained silver.

T3 will produce about 30,000t of contained copper each year over the first 10 years, along with 1.2moz of contained silver at an average all-in sustaining cost of $US1.76 per pound.

The mine holds a pre-tax net present value of $US316 million ($451 million) at an internal rate of return of 25 per cent.

Sandfire, which owns the DeGrussa copper operations in Western Australia, will spend an initial $US259 million ($A371 million) on capital works for T3 including mining pre-strip, process plant and site infrastructure development.

The board today approved the mine, along with an additional $US20 million ($A28 million) investment to support a planned expansion.

The company has also appointed engineering contractor Lycopodium to service the Motheo treatment plant.

Sandfire managing director Karl Simich said T3 would be central to the Motheo production hub.

“This is the start of a much bigger long-term copper production and exploration story for Sandfire in Botswana,” he said.

“The T3 base case at 3.2mtpa is robust in itself… but the bigger picture for us is the key growth steps that we are confident will be taken soon after we start production in early 2023.”

Sandfire is planning to expand the operation to a 5.2mtpa processing capacity using reserves from the project’s A4 deposit, situated eight kilometres west of T3.

The company has announced a maiden inferred resource for A4, which contains 100,000t of copper at an average grade of 1.5 per cent copper.

Mr Simich said A4 was the most obvious choice to expand the Motheo operations.

“We will advance this maiden A4 mineral resource quickly, with drilling already under way to upgrade it to indicated status and work beginning on a pre-feasibility study aimed at integrating it as a source of satellite ore feed for an expand 5.2mtpa Motheo production hub,” Mr Simich said.

“We anticipate being in a position to commit to that expansion during project construction, with the overall goal of ramping up to the higher production rate shortly after commissioning.”

Sandfire shares closed up 9.8 per cent to trade at $4.81.


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