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Published by Paydirt Media, 2019-12-06 01:59:57

pd278-Dec19-mag-web_Neat

Project success


at the earliest

opportunity




























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Construction and Commissioning while maintaining a high level of safety and operational

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PROVIDING GLOBAL MINERAL PROCESSING SOLUTIONS

INDABA PREVIEW





Eritrean potash venture



close to fruition




anakali Ltd stands on the verge of real- particularly the capex. Kore Potash is also where chloride levels must be kept low.
Dising a decade-long ambition of build- bound because it has pitched too high a Most current SoP supply comes from
ing Eritrea’s first potash mine. capex.” the expensive, environmentally question-
In August, the company secured Wage said Danakali’s “more modest” able Mannheim Process. Wage said Da-
$US200 million via a senior debt facility approach – a 475,000 tpa start-up project nakali’s solid salt resource held many ad-
with the Africa Finance Corporation and followed by a doubling of production later vantages of current supply.
African Export Import Bank for construc- in the mine life – was more fundable. “It is in a very good position on the cost
tion of its Colluli potash project in the East “We could’ve gone for 1 mtpa immedi- curve. If tonnes are displaced, it wouldn’t
African nation. The company is now in ately but that would’ve stressed the infra- be from our side but the Mannheim sector,
final negotiations over a cornerstone in- structure which would have meant more particularly given the environmental con-
vestment likely to cover the remainder of capex upfront and getting capital in be- cerns attached to that market. Demand is
the $US302 million capex for Colluli with comes all that much harder,” he said. still there and the market needs both pri-
a 2020 target date set for first production. Danakali also boasts marketing advan- mary and Mannheim production to satisfy
“We plan to raise $US325-350 million in tages. While Sirius is attempting to sell its needs.”
total and the next step is to get a partner polyhalite, essentially a new fertiliser prod- Danakali has spent a decade testing
for the equity, not necessarily for every- uct, Danakali is tapped into the robust and and marketing its product, all while build-
thing but enough to start construction and growing sulphate-of-potash (SoP) sector. ing a project in one of the world’s most iso-
get our owners team and DRA, the EPCM “They are completely different prod- lated jurisdictions. Eritrea was subject to
contractor, mobilised,” Danakali chief ex- ucts,” Wage said. “Polyhalite is a develop- 20 years of sanctions due to cross-border
ecutive Niels Wage told Paydirt. ing market which isn’t very big today but disputes with neighbour Ethiopia. Howev-
“We are working with Standard Char- SoP is an established 7 mtpa market and er, since a peace agreement was reached
tered to secure that strategic partner. We our offtake partners particularly like the 12 months ago, international investors
are close and have exchanged term sheets quality of SoP we can produce. It is from have returned en masse to the country.
for a big portion of the equity requirement. solid salts, so it is predictable and we have “There is certainly activity – renewa-
Having one or two cornerstone investors, a very good idea about the product.” bles projects, telecommunications, new
as well as existing shareholders who have SoP is a vital fertiliser in high value crops construction – but the frustration is that
indicated they will be supportive of an government is in the way of things de-
equity raise, will go a long way to secur- veloping,” Wage said. “It is very prudent
ing the funds we need. We have had and analytical. They are scared of mak-
discussions with institutional investors ing the wrong decision. They embrace
who are interested but want to be the opportunity but don’t jump into bed im-
last money in after the offtake – which mediately.”
we have secured – the senior debt and Danakali is not one of those frustrated
the first big chunk of equity.” companies. Wage said he was delighted
Danakali is advanced as any of the with the support and engagement his
new generation of potash producers but company had enjoyed through JV part-
Wage is conscious that several peers ner and state-owned miner Enamco.
have recently fallen by the wayside. In “Enamco is a very constructive and
September, Sirius Minerals plc scrapped supportive JV partner,” he said. “They
plans for a $US500 million bond issue to provide support and communication with
fund development of its North Yorkshire the Government when needed which is
polyhalite project after appetite waned vital to future development.
for the project’s big capex. Similarly, “Eritrea is poor and has a lot of chal-
West African-focused Kore Potash plc lenges for development and economic
has stripped back its Kola project af- investment. Colluli is very important and
ter failing to entice investors to fund its it is in their interest to see the project
$US2.3 billion capex. developed. The economic impact of Col-
Wage said Sirius and Kore’s difficul- luli on the revenue of the country is im-
ties had reinforced Danakali’s decision mense, given it will pay 38% corporate
to take a modular approach to Colluli’s tax and 3% royalty. It will represent a
development. 50% increase in exports by 2030.
“Sirius is clearly a different project and “This project is important for the Gov-
product,” he said. “It is a more complex ernment to show a stable environment
project because it is 1.5km deep and for investors. It understands it must show
has a tunnel running under a national stability in order not to scare investors.”
park. Sirius did a tremendous job of The solid salt mineralogy of the Colluli resource
marketing and promoting the project but gives Danakali massive processing and cost – Dominic Piper
it is now proving a massive challenge, benefits over rival potash hopefuls


Page 52 DeCeMBeR 2019 - JaNUaRY 2020 aUSTRaLIa’S PaYDIRT



BUILDING BUILDING A GRAPHITE MINE IN TANZANIA

INEVITABLY COMES WITH A LOT OF FIRSTS.
MAHENGE HOWEVER, AS BLACK ROCK MINING LTD CHIEF
JOHN DE VRIES EXPLAINS, CUTTING CORNERS
IS NOT AN OPTION.


It
has now been almost three years since de Vries stepped into the “We have a track record of being the first to have done a lot of things and
hot seat at Black Rock. At the time, the company was in a pack of with that comes some pretty significant challenges,” de Vries says.
graphite hopefuls emerging out of East Africa. “To be successful in graphite, you have to do things differently but you also
Under the leadership of experienced mining engineer de Vries, Black Rock’s have to do things properly. Probably one of the biggest challenges I’ve had
value has tripled and its Mahenge graphite project is now positioned as as CEO is balancing the expectations of investors who might think you can
potentially one of the world’s largest graphite producers. cut corners and still produce a result.
Along the way there have been plenty of firsts, including production of a “You won’t see us cutting corners – there are great perils in cutting corners
commercial-scale 99% concentrate, operation of the largest-known pilot as we’ve seen in the performance of the listed graphite sector to date – but
plant run for a graphite project and development of a transparent offtake what we also know is that same-same doesn’t work in this space.”
pricing framework. The culmination of a busy 2019 for Black Rock was an enhanced DFS (eDFS)
on Mahenge, about 370km south-west of Dar es Salaam.
Central to the eDFS was customer demand for a more aggressive ramp-
MAHENGE GRAPHITE PROJECT - DFS comparison up of the proposed production schedule, with an unintended outcome
being the addition of a fourth module which had no material impact on the
October 2018 DFS July 2019 eDFS forecast capex for the preceding three phases.
Post-tax NPV 10: $US895 million $US1.16 billion With the addition of a fourth module of 85,000 tpa, Black Rock is now eyeing
Post-tax IRR: 42.8% 44.8% total steady-state production of 340,000-350,000 tpa from Mahenge, up
Module one capex: $US115 million $US116 million from the 250,000 tpa proposed in the original DFS released in October
Module two capex: $US69.5 million $US69.5 million 2018. As a consequence, post-tax NPV10 increased 30% to $US1.16 billion.
Module three capex: $US84.2 million $US85.3 million Black Rock also intends to bring each module online annually rather than
Module four capex: N/A $US67.1 million every two years as previously indicated.
Life-of-mine: 32 years 26 years “When we set out on this journey, the one thing that was abundantly clear was
Average production: 250,000 tpa 340,000 tpa we had to produce a DFS that was going to be fundable, as opposed to simply
pulling together a study that would produce a transaction,” de Vries says.
Total production: 6.6mt 7.4mt “We’ve engaged in a lot of dialogue around what our funders want. We’ve
Life-of-mine C1 costs: $US401/t $US397/t called this the enhanced DFS, but really we should be calling this the fundable
Life-of-mine AISC: $US473/t $US494/t
DFS because our customers and the financial markets are ultimately going
to drive how we get this project built.”

OFFTAKE PRICING FRAMEWORK

Regular Premium Ultra
Nominal graphite grade 94.5-95.5% 97.5-98.25% >99%
TGC TGC TGC
CIF China (ex-duty) $US1,117/t $US1,490/t $US2,161/t

Exchange rate RMB:US 6.71
Rise & falling price reference
95% TGC - #100 mesh Benchmark Minerals
$U950/t as at Nov 2018



One of the key changes outlined in the eDFS is the provision of a 10MW It seems de Vries is not the only who is recognising the potential in front
duel fuel (HFO/diesel) power station for module one. Prospective financiers of Black Rock with Mining Journal also naming Mahenge as one of the top
indicated to Black Rock a strong desire to decouple the mine start-up from five projects globally.
the development schedule for TANESCO’s 220KV high voltage lateral from Black Rock, which is targeting first production in 2021, is working with
Ifakara to Mahenge. mandated financial adviser, ICA Partners, in preparing protocols and
The TANESCO grid is expected to be available for module two and the documentation for a project financing round.
station will then potentially serve as a back-up/standby power option for “Finance arrangements can be long-lived so, as with all our project work
the mine. to date, we are focussed on getting it right rather than doing it fast,” de
A pivotal factor in the outcomes of the eDFS was an 18t pilot plant run in Vries says. “We would however expect news flow on the financing front to
China during March, supplementing the previous test work completed by increase as we progress further into the funding process.
SGS Lakefields Laboratories in Canada. “In some respects, graphite is no different to any other commodity –
Black Rock’s EPC partner, Yantai Jinyuan Mining Machinery, oversaw the cost of your project finance, if available, tends to be bear an inverse
the operation of the pilot plant. Large flake concentrate was then made relationship to the quality and depth of your study work. As a key
available to potential customers for validation purposes. differentiating feature of Black Rock and the Mahenge Project to date, we
“Ultimately in the world of customers, when you’re producing a plus-99% believe this offers the opportunity to achieve a financing package superior
product which nobody on the planet has ever seen before, there’s a degree to what many of our peers are currently pursuing.”
of scepticism in the offtake markets,” de Vries says.
“I am a strong believer that seeing is believing so we invited everybody to COMMITTED OFFTAKE VOLUMES BY CUSTOMER
come and have a look. Essentially it was run by the Chinese, for the Chinese,
so the Chinese would believe us. They then took away the material to do Year 1 Year 2 Year 3
their own validations and they’ve since signed up for a pricing framework
which no one else has achieved to date; again, another first.” Heilongjiang Bohao 20,000t 50,000t 90,000t
Four of Black Rock’s five offtake partners have agreed to the framework Qingdao Fujin 10,000t 15,000t 15,000t
which guarantees pricing is dependent only on the type and quality of the Taihe Soar 20,000t 55,000t 100,000t
graphite product to be supplied to each customer. Qingdao Yujinxi 20,000t 20,000t 20,000t
The framework reflects CIF pricing in China, includes ocean freight and a Yantai Jinyuan 15,000t 30,000t 30,000t
rise/fall clause referencing benchmark pricing to protect both supplier and
customer. Import duties are excluded as many customers are located in TOTAL 85,000t 170,000t 255,000t
duty-exempt import/export zones.
With mining and environmental licences already in hand, Black Rock
has appointed Ironstone Capital to help drive the financing process for
Mahenge. The company has also beefed up its own team with former Gold
Road Resources Ltd managing director Ian Murray joining the board as a
non-executive director earlier this year. De Vries was promoted to MD in
September.
“We’re becoming a championship team made up of champions,” de Vries
says.
“I looked at the playbook Ian put together at Gold Road and followed it
shamelessly. To have had the honour of the guy whose playbook I copied
say: ‘I’d like come along and work with you’ was monumental. Then to tie
that up with Crookesy [chairman Richard Crookes] we have the pedigree
of project finance experience under our belt and scar tissue in all the right
places. I feel we’ve got the right skills and the right people to make this
happen.”






Office: 45 Ventnor Avenue, West Perth, Western Australia 6005 Tel: +61 8 9389 4415 Web: blackrockmining.com.au

Key people:
Richard Crookes (non-executive chairman), John de Vries (CEO & managing director), Gabriel Chiappini (non-executive director
& company secretary), Ian Murray (non-executive director), Dale Hanna (interim chief financial officer), Raymond Hekima
(vice-president corporate, Tanzania)

INDABA PREVIEW





Trio trump Fortescue




consortium representing Chinese, French ing Ministry.
A and Singaporean interests won a $US14 SMB-Winning chairman Fadi Wazni con-
billion tender to develop part of Guinea’s firmed the figure.
Simandou iron ore project, sources familiar “The Simandou project will be crucial for
with the talks told Reuters, edging out Aus- Guinea’s future. This mega deposit is an op- Andrew Forrest’s (centre) Fortescue Metals
tralia’s Fortescue Metals Group Ltd. portunity in terms of employment and wealth was overlooked for participation in Simandou
The consortium – which includes Société creation for the whole country,” Sun Xiushun,
Minière de Boké (SMB) and Singapore’s Win- the consortium’s chief executive, said. Trans-Guinean railway than Fortescue – a
ning Shipping as well as Guinean government Fortescue had offered $US9 billion for the deal-breaker for this project,” Humphery-
interests – has committed to develop Blocks 1 blocks but did not formally promise to build Smith said.
and 2 of the largest known deposit of its kind, the railway dubbed the “Transguinéen”, two Investors in the relatively little-known win-
holding more than 2bt of high-grade ore. government sources told Reuters. ning consortium include Chinese aluminum
Guinea has sought to develop the Siman- Transguinéen was pivotal in the decision to producer Shandong Weiqiao, a unit of China
dou deposit for decades, but the project has grant the blocks to SMB-Winning, Mines Min- Hongqiao and Yantai Port Group, as well as
been mired in protracted legal disputes and ister Abdoulaye Magassouba told Reuters. Guinea’s government.
the high costs have curbed interest. Fortescue confirmed in a statement that it The consortium is Guinea’s leading export-
The Government required bidders to build had lost the bid. er of bauxite.
a 650km railway and deep-water port to The Australian company said it will focus Magassouba said the Government would
transport the ore from the remote south-east- on its $US3.88 billion investment in the Eli- now hash out the technical details of the
ern corner of Guinea to the coast for export, wana and Iron Bridge projects in Western deal with SMB-Winning and put the resulting
deterring some miners from bidding. Australia’s Pilbara region. agreement to a vote in parliament.
SMB-Winning put $US14 billion on the ta- Eric Humphery-Smith, senior Africa ana- SMB-Winning aims to bring the deposit to
ble to develop the blocks and build the infra- lyst at consultancy Verisk Maplecroft, said the production within five years of the agreement
structure, according to a government source outcome was hardly surprising. being ratified.
who asked not to be named because they are “It was clear from the beginning that SMB – Reuters
not authorised to speak on behalf of the Min- was more likely to commit seriously to the


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2582_PA_ECG_PayDirt_130x187mm.indd 1 10/7/19 6:04 pm
Page 56 DeCeMBeR 2019 - JaNUaRY 2020 aUSTRaLIa’S PaYDIRT



INDABA PREVIEW





West Africa in consideration




nvestments across West Africa will suffer
Iin light of the attack on a SEMAFO Inc
convoy travelling from Ouagadougou to
the company’s Bongou gold mine in east-
ern Burkina Faso.
“All investments in Burkina Faso will
suffer to some extent after the SEMAFO
disaster, but then that will even tarnish the
reputation of West Africa as an investment
destination as well,” Australian High Com-
missioner to Ghana Andrew Barnes told
Paydirt.
Through the Accra post, the Australian
High Commission is responsible for rela-
tions in Burkina Faso, Côte d’Ivoire, Guin-
ea, Liberia, Mali, Senegal, Sierra Leone
and Togo.
While there was no specific intelligence
leading into the SEMAFO incident, the
area of the attack has been is an area of
concern and is considered a red zone for
the Australian Government.
There has been a deterioration of the se-
curity situation in Burkina Faso in the last Andrew Barnes
18 months and parts of the country have is not in a red zone, it is in a ‘reconsider
become more dangerous, as jihadists your travel’ zone, so we don’t see it in the activity across the region was expected.
started their infiltration from southern Mali same light as SEMAFO. But of course, it However, Askew said METS compa-
into northern Burkina Faso and now into can change at any time and we have things nies, such as drillers and exploration
the country’s south-east. under review all the time,” Barnes said. outfits in the region, were yet to see any
“As much as anyone, we have a very While Barnes expects investors to cool heightened activity.
good understanding and appreciation of on plays in Burkina Faso and Mali for the “It has been very difficult for projects in
the security environment in Burkina Faso. time being, he said the West African min- West Africa to attract capital. Money has
As we are not located in Ouagadougou, we ing scene needed to be put in context and been going into cannabis and bitcoin/
are in close contact with our like-minded not ignored. blockchain currencies [in North America]
missions there. We pass on any security “There is certainly a lot of interest and a which has really diverted a lot of capital
concerns through the travel advice and lot happening, but people are still cautious. away from the gold industry,” Askew said.
take our travel advice to the general public In Ghana, it is a mixed picture, there are “I think this [SEMAFO] event is only go-
and mining industry very seriously,” Aus- some good prospects but there are still ing to make it more difficult for exploration
tralian Department of Foreign Affairs and frustrations with the Government on some companies to attract the capital they need
Trade (DFAT) deputy high commissioner, issues,” Barnes said. to get a project off the ground. The situa-
Ghana, Glen Askew told Paydirt before “Cote d’Ivoire is quite a positive story with tion in Burkina Faso will wave a red flag
travelling to Ouagadougou to meet with both belief in the potential for resources to and it will potentially drive capital away
some of the Australian business fraternity. still be discovered and a strong gold price from West Africa, particularly Burkina
“Our biggest client in Ghana/West Af- making prospecting and development at- Faso. For [SEMAFO] it is devastating, but
rica really is the mining community and as tractive. it is an event of serious magnitude for Aus-
such we make it a point to get out to our “There is a lot of hope for Burkina Faso, tralian companies in Africa more broadly.”
countries regularly. Burkina Faso is obvi- but the security situation is front and cen- Such is the security concern in parts of
ously one of the most important for us, one tre of everyone’s minds and that is going to West Africa, the Australian High Commis-
country we have to watch and keep up to hold things back. Guinea and Liberia are sion ran a security conference in Accra in
date with and keep ourselves educated on seeing massive potential and significant in- June, which was well received within the
as much as possible. We do keep on top of terests from Australians as does Senegal. mining community. Meanwhile, through
the issues there.” It is a very good picture in West Africa gen- initiatives like the Australian Mining Net-
The SEMAFO incident did not lead to erally. We just have to try and get that mes- work WhatsApp group, the Australian High
changes in travel advice for other parts of sage out to Australian mining companies Commission has been tightly connected
Burkina Faso such as where ASX-listed and investors, but on the other side of the with the mining fraternity with the platform
gold developer West African Resources coin it has to be tempered by the accept- a good source of information sharing for
Ltd (WAF) is situated. ance of the risk in just a few certain places everyone concerned.
WAF is currently constructing the San- in Mali and Burkina Faso,” Barnes said.
brado gold mine, which Barnes visited in The gold prospectivity of West Africa – Mark Andrews
early 2019. has not changed and given gold prices
“Sanbrado is not in a no-travel zone, it above $US1,500/oz, healthy exploration


Page 58 DeCeMBeR 2019 - JaNUaRY 2020 aUSTRaLIa’S PaYDIRT



INDABA PREVIEW





WAF stays the course




mid troubling times in select parts of
Anorthern and eastern Burkina Faso,
West African Resources Ltd (WAF) ex-
ecutive chairman Richard Hyde remains
unflappable in his desire to deliver the
Sanbrado gold project for the good of the
country.
“The reality is that this project is go-
ing to make a huge difference in Burkina
Faso, it is now a project with national sig-
nificance,” Hyde said.
“There is a lot of good that will come
from this project for the surrounding pop-
ulation in terms of the health, education
and training benefits from the significant
contributions made to the community de-
velopment fund. The people of Burkina
don’t deserve the unrest and the vio- Richard Hyde
lence they are enduring in the north and
east of the country. We remain commit-
ted to our people, the Sanbrado project gou – will be the closest operating mine
and Burkina Faso.” to Burkina’s capital.
Hyde was speaking to Paydirt before It takes about an hour and half on a
leaving Perth for Burkina shortly after very busy road to get from Ouagadou-
Canadian company Semafo Inc was tar- gou to Sanbrado, which is comparatively
geted by terrorists. easier to access than many other mining
At the time of print, Semafo had con- sites anywhere else in the world.
firmed that 241 of its employees, contrac- With respect given to the sensitivities
tors and suppliers, including personnel of its staff in country during this current
from ASX-listed Perenti, were involved period, WAF is still on course to pour first
in the attack as they were making their gold from Sanbrado by the end of June
way to the Bongou mine site from Oua- 2020.
gadougou. Mechanical installation is expected to
The latest update from Semafo con- be completed by the end of December
firmed 39 fatalities, 60 injuries, 141 peo- and a fresh new plant scheduled to be
ple accounted for and one remaining un- fully electrically wired by the end of Q1
accounted for. 2020. Commissioning and ramp-up will
Operations at Bongou remained sus- then follow in Q2, with the first 12 months
pended in mid-November, as industry of production scheduled to produce over
continued to come to grips with the situa- 300,000oz gold at AISC of less than
tion in Burkina Faso. $US600/oz.
“We had a minute silence in our Oua- Project-wise, things have gone well for
gadougou office and on site at Sanbrado WAF in 2019 after it locked in a $US200 that have just started on site who are do-
in light of the incident because this was million debt facility with Taurus Funds ing a great job. Of course, some of them
really an attack on Burkinabes,” Hyde Management Pty Ltd 12 months ago to have families back home in Australia
said. build Sanbrado. wanting them to return and others are
Security measures have been paid the The company has drawn down asking us what we are doing differently,”
utmost attention by WAF, with processes $US145 million of the Taurus facility thus Hyde said in relation to security concerns
and procedures from Ouagadougou to far, with key equipment arriving on site as in Burkina.
Sanbrado significantly improved in-line planned and the recruitment drive in full Hyde said no one was immune to in-
with security enhancements on site and swing at the 10-year Sanbrado project cidents such as the tragedy suffered by
at camp. (6.5 years underground mining). Semafo, however, he backed the com-
“I am comfortable with the measures Production over the first five years of pany’s philosophy behind adhesive com-
that we have implemented and we have mine life of is 217,000 ozpa gold and a munity relationship building to hold WAF
key personnel in our organisation with 14-month post-tax pay back on $US186 in good stead in the face of challenging
extensive military experience and experi- million pre-production capital costs. situations.
ence with dealing with security situations AISC of about $US600/oz over first “The large part of successfully oper-
in Burkina and the broader region,” Hyde five years and $US650 over life-of-mine ating in our area includes building and
said. is estimated. maintaining strong relationships with our
When up and running WAF’s Sanb- “We are hiring people on site now and host community. We are the largest em-
rado – 90km direct line from Ouagadou- it is a real challenge. We have people ployer in the region, most of our unskilled


Page 60 DeCeMBeR 2019 - JaNUaRY 2020 aUSTRaLIa’S PaYDIRT

First gold from Sanbrado is expected in June 2020. Few companies have managed to deliver
projects according to feasibility timeframes like WAF has in Burkina Faso


workers are coming from surrounding vil- in Burkina Faso. military, they are security specialists with
lages. We have significant programmes “Everything in the new Mining Code extensive networks across the West Af-
in place to train our local workforce and that we were entitled to in terms of re- rican region.
that is where you have to start,” he said. duction in duties and taxes and exon- “Our build team has fitted in really well
“You have to start by being good citi- eration of VAT during construction, have into our company so we made that tran-
zens, doing the right thing and having been delivered to us. We have had great sition from exploration and development
strong local relationships; you can’t have support from the Burkina Faso govern- company to construction and we will now
an us and them mentality.” ment and we have had no impediments be hiring for operations and I am confi-
While Sanbrado is on track to be deliv- moving the project forward. In fact, that dent that transition will be smooth,” he
ered on time and on budget, there is no is why we are currently tracking ahead of said.
doubt would-be mine developers in the schedule because we have had no hold – Mark Andrews
future may experience stronger head- ups moving key pieces of equipment
winds in bringing a mine to the fore in the through customs to site,” Hyde said.
country. “Managing personal security has been
Hyde said there was confusion be- challenging. A number of our key man-
tween personal safety and political risk agement team in Burkina Faso are ex-


aUSTRaLIa’S PaYDIRT DeCeMBeR 2019 - JaNUaRY 2020 Page 61

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INDABA PREVIEW





Virgo to IPO




aving reached a career high point with “In addition
Hthe discovery of the Boseto copper to Sandfire’s T3
project in Botswana, Quinton Hills is eager project, I predict
to taste similar success in the country as there will be four
managing director of Virgo Resources Ltd. or five more cop-
Hills was senior geologist at Discovery per mines in that
Metals and was largely responsible for terrain in the next
finding about 100mt of copper at Boseto. decade.”
That project ultimately proved too chal- The northern li-
lenging for Discovery but the knowledge cences of Virgo’s
base established by Hills through that ex- tenure in the Kala-
perience will prove invaluable in his new hari Copper Belt
float Virgo. are along strike of
Backed by non-executive chairman Ian T3 and Cupric’s
Murray, Hills was looking to list Virgo on Banana and Eland
the ASX by December 20 after raising zones.
somewhere around $4.5-5.5 million. Virgo’s north-
Hills stopped by the Paydirt office dur- ernmost licence
ing Virgo’s Australian investor tour in No- is in the same
vember and was happy to report healthy geological setting
interest in Virgo’s Botswana copper and as Cupric’s Zone
Namibian gold projects. 5 (100mt @ 2%
“Markets are still hard, but with BHP copper and 20 g/t
[Ltd] concentrating on copper and cop- silver) and Zone 5
per’s role in the renewable future/elec- North (26mt @ 2%
tric vehicles; people think that copper is copper and 40 g/t
the next thing that will run and everyone silver), which are
wants to be in a vehicle that is in an as- the highest-grade
set when the commodity turns and that’s copper resources
the key with Virgo,” Hills said. “We want to in the Kalahari
be a copper vehicle like Discovery Metals Copper Belt. Virgo hopes to be listed on the ASX
was back in the day and when the price “Meanwhile, one of the other explorers by December 20
turns, we can ride the price all the way in the area Kalahari Metals [Ltd], which weren’t assayed for gold,” Hills said.
up.” is majority owned by Metal Tiger [plc] re- “All those resources are open down
The situation in Botswana has changed cently drilled 24m of copper sulphide [as- plunge, so we can incrementally improve
significantly since Hills was with Discov- says pending]; that is right on the bound- and grow them with low risk, low hanging
ery and while the country has always ary of our most prospective tenement of fruit type of exploration to grow resourc-
ranked highly as a favourable jurisdiction the northern part of the Kalahari Copper es. The great thing about that project is
to do business, infrastructure has not al- Belt,” Hills said. that there hasn’t been a modern EM sur-
ways complimented the mining sector. “I believe that the structural setting of vey. There is a lot of sand cover, no one
“There was always infrastructure on the geological interpretation of that area has asked what the best thing for the area
the eastern side and now that the infra- is analogous to what Cupric Canyon have is, no one has done a regional EM survey
structure is starting to push across into near the old Bosteo mine with the Zone 5 and asked if they are actually in the right
the western part of Botswana and open and Zone 5 North. I believe we have the place.”
up that region of the country,” Hills said. same analogous structural setting on our By following simple exploration pro-
Hills said now that power access was tenements over 35km of strike length of cedures Hills hopes to land another De-
better the country had more to offer pro- the right copper stratigraphic level.” Grussa or Khoemacau type of discovery.
spective resources companies. Recent Hills said soil sampling and ground/air- “If the exploration concept is going to
activity by Cupric Canyon Capital and borne geophysics would be the first port be difficult to execute that increases risk
Sandfire Resources NL was only the start of call at PL40/2018 in Botswana where and I am looking at lower risk things,” he
of things to come he said. he hoped to be drilling sometime in the said.
“Cupric Canyon has just raised $US650 first half of 2020. “The No.1 thing is protection to the
million to build the Khoemacau copper- Clearly excited about the opportunity downside of the share price by having
silver deposit with a lot of that money to make a greenfields discovery in Bot- clear extensions [at Hope] and a lower
raised by RCF. Then Sandfire has just swana, Hills said the Hope copper-gold risk exploration strategy, but on the junior
completed a cash and scrip deal for $167 project in Namibia was a complementary side of the market you must show expo-
million to takeover Mod and the reason asset to have in the portfolio. sure to a discovery to shareholders. We
for the renewed activity in the Kalahari “We have resources right now that can are here for the 5-10 times uplift in value
Copper Belt is the power infrastructure be improved, there’s a gold grade there or why else would you do the risk?”
delivered there helps reduce the operat- that needs to be better understood be-
ing costs,” Hills said. cause there were holes drilled there that – Mark Andrews


Page 64 DeCeMBeR 2019 - JaNUaRY 2020 aUSTRaLIa’S PaYDIRT

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Cardinal


prepares for take off








Very few companies in
the current day have
seen a greenfields

discovery through to
development.






The transition from exploration
outfit to gold producer is challenging
and often not the ambition of junior
companies.
Cardinal Resources Ltd is not one of these
companies.
From the outset, Cardinal has had the
inhouse capabilities to explore, discover
and develop a project and its dedication to and construction team as it looks towards our feasibility study as they can apply
do so has amplified since a feasibility study first gold pour at Namdini. mining costs, cyanide costs, labour costs
confirmed Namdini as a Tier 1 gold project. “Namdini is poised to become the to our model to gauge where our project
sits. A lot of lenders and corporates are
In the first three years of production, first large-scale operating mine in the in the data room and another five have
Namdini is slated to produce 1 moz gold, Upper East region of Ghana, delivering come forward since the gold price has
with 421,000oz expected straight off the sustainable prosperity and opportunities recently run. Maybe more will come
bat in Year One. to all stakeholders. We are grateful for the forward and start to talk to us , who
continued overwhelming support of these
Thereafter, consistent production of communities and their elders, along with knows?”
287,000 ozpa gold over 15 years from the the Government of Ghana to bring this One thing Koimtsidis definitively knows is
5.1 moz reserve at Namdini is estimated to project into production,” Koimtsidis said. how to build a project.
generate $US1.46 billion (undiscounted,
pre-tax free cash flow). “We have three positions to fill in Having steered the PMI Gold-turned-
Asanko Gold Inc ship towards production
“I think the scale, economic returns and construction, environmental and in the of 240,000 ozpa at the Asanko mine
CSR department. We are down to a
profitability are the wow factors for shortlist of quality candidates and we will in Ghana, Koimtsidis has experience in
Namidini,” Cardinal managing director be appointing people very soon; there are country and is backed by a throng of well
Archie Koimtsidis said.
a lot of good Ghanaians who can fill those credentialled people on his team.
“Once it is paid off, it delivers a lot of cash. positions.” Cardinal exploration manager Paul Abbott
Payback was pencilled in at $US1,350/oz As the Cardinal stable grows, Koimtsidis is (also at PMI with Koimtsidis), chairman
– 21 months; it goes through the roof when amid a financing and marketing campaign Kevin Tomlinson, executive director Malik
the gold price is $US1,500/oz. The initial to ensure Namdini gold is poured in 2022. Easah, non-executive directors Michele
feedback we have got from the feasibility Muscillo, Trevor Schultz and Kenneth
study is that it is huge, of great scale and Project financing discussions with Thomas, chief operating officer Dave
the economic results are fantastic, making Australian and international banks were Anthony and project manager Bruce
this a Tier 1 project.” ongoing in 2019 and several preliminary Lilford have the requisite skills to drive
non-binding term sheets have been
Even before the feasibility study was received. Namdini to its ambition of making the step
announced, Cardinal had established an from explorer to producer.
impressive following with Gold Fields Ltd Now that the feasibility study is in the The make-up of Cardinal’s project
taking a significant interest in the company. public domain, Koimtsidis expects financing is still being decided, with
Gold Fields’ 10%-plus shareholding in Namdini to be analysed to the nth Koimtsidis focused on delivering the best
degree.
Cardinal has been accumulated on-market. solution he can for company, country and
While Gold Fields maintains its position, “A lot of people can now compare shareholders.
whether we are in the ballpark or not with
Cardinal is beefing up its development

Cardinal Resources Ltd
(ASX/TSX:CDV)
Project: Namdini, Upper East region, Ghana
Status: Feasibility study October 2019
Reserve: 5.1 moz gold
Mine life: 15 years open pit
Production: 130mt for 4.2 moz
AISC: $US895/oz
Throughput: 9.5 mtpa
Processing: Conventional crush, grind,
float, regrind, high shear oxidation
(Aachen TM) and CIL
Capex: $US348 million plus $US42 million
contingency. Payback 21 months (12-month
payback at $US1,500/oz)
Financial model: $US1,350/oz
NPV: $US914 million (pre-tax);
$US590 million (post tax)
IRR: 43% (pre-tax); 33.2% (post tax)
First gold: H2 2022
Cardinal’s cash balance: $US27 million



“We are not married to any particular project financing with peers such as West current economics at Namdini, which was
structure, it comes down to minimum African Resources Ltd bringing projects only discovered in 2015.
dilution of company, minimum dilution of on stream in 2020. Koimtsidis says such Ndongo East is one regional prospect
asset and whatever scenario stands out successes enhances the sector as a whole. that has been shaping up nicely for
best for all shareholders,” he said. “Anyone that can come online and Cardinal – 4.1m @ 13.1 g/t gold from 9m;
“Whether that is a combination of produce gold within budget is a good 9.1m @ 2.9 g/t from 37m and 7.6m @ 4.8
traditional lending, JV or even a sale thing, it doesn’t matter which commodity g/t – being the best hits in the September
of the asset; we are not married to any you are in. But, in West Africa we have 2019 quarter.
of these concepts. We are de-risking had a lot of success, especially with the Koimtsidis said that while financing
the project further and optimising the likes of Lycopodium [Ltd] having built for Namdini was a focus for Cardinal,
FEED. All these things are running in the mines well in the region and having a exploration activities would not be
background and in parallel with financing long history of bringing projects online on ignored.
discussions and I have no doubt more time and on budget,” Koimtsidis said.
options will be forthcoming.” Lycopodium, Golders Associates Pty Ltd “We should kick-off exploration again
in December. It is a district play for us
The strength of gold makes for an and the various study managers involved and hopefully this is just the start of
opportune time to be in the market for with the feasibility at Namdini drew high something bigger; Namdini is just an
praise from Koimtsidis who tips Cardinal’s excuse for us to build a production
stay in Ghana to be a long one given the facility to get started. It is a bit like
exploration potential across 900sq km Granny Smith [Gold Fields’ operation
of ground within trucking distance to the in Western Australia] which kicked off
planned Namdini plant site. as a 10-12 year mine and 30 years later
Once the wet season subsides, Cardinal it is still there because of the satellite
will be back drilling, targeting shallow, deposits around it,” Koimtsidis said.
high-grade deposits that can sweeten the



Australia Office Ghana Office
Suite 1, 28 Ord Street, West Perth, WA 6005 Durugu Residential Area, Kumbosco,
PO Box 829, West Perth WA, 6872 Australia Bolgatanga
+61 8 6558 0573 PO Box 350, Bolgatanga, Ghana
[email protected] +233 382 021 838
[email protected]

INDABA PREVIEW





Tanga starts Namibian exploits



in earnest



fter a slow start, Tanga Resources starting the drilling in July.” plus-500m mag anomaly under alluvial
ALtd has finally started drilling on its The first target for Tanga was the Main cover.
Hagenhof copper project in Namibia. Gossan prospect where it was following “They’ve never been drilled before and
Tanga switched focus to Namibia two up on historical reports of copper-cobalt we are very keen to test them,” Bowles
years ago after its Hanang gold pro- mineralisation. The first drill holes re- said.
ject became a victim of the Tanzanian turned hits of 17m @ 0.82% copper from Alongside Hagenhof, Tanga has the
Government’s revised mining policies. 111m (including 9m @ 1.1% copper) and Katerina gold project in Namibia.
However, Namibia’s licencing system is 24m @ 0.54% copper from 86m (in- “It is a JV with Epangelo [Mining, Na-
notoriously slow, and the company was cluding 1m @ 1.73% and 1m @ 1.84%). mibia’s state-owned miner],” he said. “B2
not granted access to its tenements until Follow-up RC drilling intersected copper Gold Corp has its Ondundu gold project
early in 2019. mineralisation down-plunge of Main Gos- 10km north-west and the team which
Tanga has shown patience because of san and Tanga decided to further define made the Otjikoto discovery have also
its belief in the eventual prize. Hagenhof extension through ground magnetics. picked up ground next door.
is hosted within a major structural setting, “The RC drilling showed there is a big “Once the licence renewal is granted,
within the gold and base metal-rich Da- southerly plunge there which we are keen we can start drilling because the Capital
mara Belt in central-northern Namibia. to test,” Bowles said. Drilling rigs will already be in the country.”
“It is a good address to be in,” Tanga RC and diamond rigs – supplied by Namibia’s exploration sector grind al-
chief executive Mathew Bowles told Capital Drilling which has taken a 14% most to a halt in the middle of the decade
Paydirt. “There are world-class projects stake in Tanga – arrived on site last after the country’s uranium boom fizzled
throughout the belt such as Navacheb month ahead of the follow-up drilling pro- out. Bowles, however, believes the entire
[27mt @ 2 g/t gold], Namib [1.25mt @ gramme. By the time the rigs begin turn- industry is due a revival.
6.5% zinc and 2.5% lead], Otjikoto [29mt ing, Tanga will have further targets after “It has a lot going for it. The infrastruc-
@ 1.5 g/t gold] and Tsumeb [74mt @ 4% completing a detailed ground EM survey ture is good with rail, road and power
copper, 10% lead and 3.5% zinc].” at Main Gossan and the Liv’s Hill target. available and it has no security issues
Hagenhof itself is an historical Phelps “We are doing ground EM over Main and is overall a pro-mining country,” he
Dodge target. After acquiring it in August Gossan to highlight that southern exten- said. “After our experience in Tanzania,
2018, Tanga undertook a programme of sion for drilling but we have also uncov- we wanted that sort of setting and hav-
geophysical and geochemical work to ered new targets to the north and west of ing Epangelo as a JV partner has been
build on the historical data and prepare it Main Gossan during the ongoing ground helpful.
for maiden drilling. mag survey,” Bowles said. “It has taken a while to put the ground
“It is clearly defined as a magnetic high Among the new targets is Main Gos- position together, but we’d rather be in the
in the historical work, so it is a clear walk- san North, a 500m mag anomaly 2km to key areas than just pegging anything.”
up drill target,” Bowles said. “We did a lot the north of Main Gossan, Main Gossan
of sampling and ground magnetics before West and the high-priority A1 target, a – Dominic Piper
































Surface mineralisation on Tanga’s Hagenhof copper project in Namibia


Page 68 DeCeMBeR 2019 - JaNUaRY 2020 aUSTRaLIa’S PaYDIRT

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aUSTRaLIa’S PaYDIRT DeCeMBeR 2019 - JaNUaRY 2020 Page 69


Untitled-5 1 2019/11/06 07:58

INDABA PREVIEW





Lindi Jumbo out in debt markets

















































Walkabout chairman Trevor Benson (left)
and executive director Allan Mulligan on
site at Lindi Jumbo

n out-of-favour commodity and ju- of planned production) and graphite risdictions and commodities in favour of
Arisdiction has meant 2019 hasn’t products manufacturer Qingdao Rising- tried-and-tested stories.
been the easiest of rides for Walkabout dawn Graphite Technology Co. Ltd (25% “It is a very strange market,” Walkabout
Resources Ltd but the company remains annual production). This was followed by executive chairman Trevor Benson told
resolute in its conviction and is planning a sales, purchase and marketing agree- Paydirt. “There is lots of money flowing
for a breakthrough 2020. ments with Hong Kong trading house into gold and base metals projects in Tier
ASX-listed Walkabout managed to Wogen Pacific Ltd for 10-30,000 tpa of 1 jurisdictions but there is nothing going
make considerable strides during the last graphite concentrate from Lindi Jumbo. into graphite or developing economies.”
12 months despite its Lindi Jumbo pro- The market responded kindly to the The issue is becoming more acute for
ject combining two of the market’s taboo progress, sending Walkabout shares Walkabout as it heads towards construc-
subjects – graphite and Tanzania. beyond 44c in July. The share price re- tion in 2020. In October, the company
In March, it released details of an tracted over the following two months launched a $US40 million senior loan to
updated DFS for Lindi Jumbo which but had been trading around 30c for the fund Lindi Jumbo’s development.
showed a project capable of posting a best part of two months as Paydirt went Executive director Allan Mulligan said
post-tax NPV of $US197 million (up 9.4% to print, giving Walkabout a $100 million the company had ensured the technical,
on the original DFS) and 199% IRR (up market cap. marketing and financial aspects of the
23.9%) off the back of a $US27.8 million The Walkabout management team project had been fine-tuned in order to
capex (down 6.4%) and $US347/t opex welcomed the warmer market conditions navigate the hostile market conditions.
(down 0.6%). but recognise the biggest task remains in “We have moved to de-risk every as-
Then in April, the company finalised front of it; finding the funding required to pect of the project,” Mulligan explained to
binding offtake agreements with expand- take Lindi Jumbo into production. Paydirt. “On the operation, we have en-
able graphite producer Inner Mongolia That task has proven more difficult sured we have a reasonable capex and
Qianxin Graphite Co Ltd (for up to 50% as investors withdraw from high-risk ju- robust opex; we have prioritised high-



Page 70 DeCeMBeR 2019 - JaNUaRY 2020 aUSTRaLIa’S PaYDIRT

grade material and the metallurgical
products are premium products which
means by nature it is a high revenue pro-
ject.
“In Tanzania, we are meeting govern-
ment requirements entirely and with their
approval we are fully compliant with lo-
cal ownership laws. The only remaining
obligation we have is for the 16% free-
carried interest and that only comes at
the declaration of net profit dividends.
“On the financial side we have locked
in the offtake and the marketing with Wo-
gen Pacific. All that remains now is to se- Walkabout is ready to kick-start development of its Lindi Jumbo graphite project in
cure the funding.” Tanzania as soon as funding is secured
In this regard, Walkabout has taken the
same strategy as it did for the technical various sectors and has experience in “We accept there are certain percep-
aspects of the project; keep it simple. greenfields mining projects and emerging tions around Tanzania and understand
“We have designed a funding pack- mining transactions. that graphite is a bit of a dark science but
age with which lenders will have a high Mulligan said Patero had conducted we’re doing the work to ensure the mar-
degree of certainty of returning funds and thorough due diligence over Lindi Jumbo ket understands our project and product
a good yield, it is a very structured, easily and Walkabout. better,” Benson admitted.
recognisable financial package support- “They have been through every aspect “There are lots of options, both geo-
ed by extensive due diligence and project of the project – technical, marketing, le- graphically and strategically. Pareto
preparation,” Mulligan said. “So, as an gal, community, etc. – it has all been vet- has a massive bond desk spanning
investment, it is all quantified to interna- ted and it didn’t turn up any fatal flaws,” Oslo, London, Singapore and New York.
tional standards.” he said. “This is very extensive for a com- They are going out to that fixed interest
The company has engaged interna- pany of our size.” bond investment market – hedge funds,
tional investment bank Pareto Securities The result is a commitment from Pareto private equity, family offices, develop-
to advise on the project funding. to find appropriate investors and Walka- ment corporations. There is an endless
The Norwegian-based bank special- bout spent much of October and Novem- number of likely groups. We think it will
ises in debt and equity financing across ber meeting with prospective partners. eventually be a syndicate of three or four
groups who could write a cheque for
$200,000 or $60 million, we don’t know
yet.”
On the ground, Walkabout is ready to
kick-start development once funding is
secured.
“We have completed most of the ear-
ly-start work in China on the processing
plant where we are finishing the manu-
facturing of the long-lead items,” Mulli-
gan said. “On site we have prepared the
roads and terraces ready for construc-
tion although that has been halted while
we wait for funding.
“We have completed relocation pro-
grammes and compensation and within
the country we have formed the Lindi
Jumbo Company which is a truly Tan-
zanian company. Everything about it is
based there; operations, the board and
revenues are in Tanzania; that is exactly
what the Government is seeking.”
– Dominic Piper











aUSTRaLIa’S PaYDIRT DeCeMBeR 2019 - JaNUaRY 2020 Page 71

INDABA PREVIEW





Graphex on the road to production




raphex Mining Ltd has received a time- “We feel that a more conservative ap- country’s mining legalisation were rolled out.
Gly boost ahead of the imminent release proach is one that’s likely to pay dividends For Hoskins and his team, a light is now
of a DFS on its Chilalo graphite project, with for our revenue and margins,” Hoskins said. appearing at the end of the tunnel.
the President of Tanzania confirming last The DFS will also be based on the up- “It’s a process that will never stop and
month that his government was committed dated resource which Graphex announced we’ll continue to seek assurances as to how
to upgrading a major road in the country’s earlier this year. The high-grade component legislation and regulations work, however,
south. of the resource now comprises 20.1mt @ we’re quite comfortable in the key pieces
Following his Southern Regions tour in 9.9% TGC, including an indicated resource that we were looking for around free-car-
October, Tanzania President John Magufuli of 10.3mt @ 10.5% TGC for 1.1mt contained ried interest, ability to export product, pro-
announced a 60km stretch of road between graphite. posed bank account arrangements and
the towns of Nanganga and Ruangwa Completion of the DFS is one of the con- these sorts of matters,” he said.
would soon be sealed. ditions precedent for Graphex’s proposed “We feel confident that finance can be
Chilalo is about 26km north-west of the project funding partner, US-based private moved ahead in Tanzania. Ultimately, be-
Ruangwa township. investment firm Castlelake L.P. fore these changes Tanzania was viewed
The upcoming DFS – due at the time of In late 2018, Castlelake signed a term as an extremely favourable African jurisdic-
print – assumes graphite products will be sheet to provide up to $US80 million – tion and I’m confident with 2019 being the
trucked 640km from Chilalo to the inter- $US40 million of equity and $US40 million turnaround year, it will return to that position
national port of Dar es Salaam. Once the from the issue of senior secured loan notes in the near future.”
Nanganga-Ruangwa road upgrade is com- – to underpin Chilalo’s development. While progress in Tanzania has been
plete, all but 26km of Graphex’s transport Hoskins is hopeful his company can pro- slow, Graphex has not stayed idle in other
route will be sealed bitumen road. ceed with construction arrangements soon areas and used the time to increase its
Graphex managing director Phil Hoskins after Castlelake has finalised its due dili- knowledge of the graphite sector and the
said his company was one of multiple par- gence of the project economics. requirements of customers within it.
ties in the region set to benefit from the Like many other Tanzanian-focused jun- Graphex unveiled its enhanced “markets
long-awaited upgrade. iors over the past three years, Graphex had first” strategy in late October, pointing to a
“For us, it means we’ll be able to travel its progress stalled while changes to the stronger focus on non-Chinese markets the
at a slightly quicker speed limit than company believes will complement
we could along the hard dirt road its existing customer relationships in
that exists there at the moment and China.
obviously that is going to have a posi- “Our graphite is far more suited to
tive impact on our transport costs,” expandable graphite and we’ve made
Hoskins told Paydirt. very large advances throughout this
“This commitment from the year in developing a strategy to es-
President, I believe, is due in part sentially toll-treat Chilalo graphite
to companies like us in the region concentrate through a Chinese ex-
looking to move things forward eco- pandable graphite manufacturer for
nomically. Not only will the project sale to fire-retardant companies that
benefit Graphex shareholders, there we’ve started communications with in
are many great benefits for the peo- western markets,” Hoskins said.
ple of Ruangwa and nearby towns. “It’s a strategy that dovetails off
“If we can get our project up, hope- the path our graphite is likely to take
fully we can reciprocate by contribut- anyway; it’s likely to go to China
ing towards an improvement in their and be processed into expandable
quality of life.” graphite and sold to these custom-
As was the case with the ear- ers. Through the marketing we’ve
lier PFS, Graphex’s DFS is again ex- done and through the connections
pected to outline the economics for a we have in China with expandable
staged production scenario at Chilalo, graphite manufacturers, we’re able to
initially kicking off with a circa 50,000 take a much larger share of the mar-
tpa operation. gins upstream and that will be highly
However, having noted some of the beneficial for our shareholders.
struggles Syrah Resources Ltd has “We feel that there’s plenty of
endured from pushing large volumes space for additional coarse flake
of graphite into the market, Graphex graphite supply, despite recent com-
is set to defer its expansion to circa mentary in the graphite market. The
100,000 tpa until the fourth year of fundamentals are extremely strong
operation rather than at the end of the and we feel as strongly as we ever
second and will also stage its produc- have that our project is ideally suited
tion increase over two years instead to take advantage of that.”
of the previously proposed one. Graphex’s long-awaited DFS on the Chilalo graphite project – Michael Washbourne
in Tanzania was due for publication at the end of November


Page 72 DeCeMBeR 2019 - JaNUaRY 2020 aUSTRaLIa’S PaYDIRT

Kibaran grafts towards Eco




new dawn beckons for Kibaran Re-
A sources Ltd, with a proposed name
change to EcoGraf being voted on at the
company’s AGM at the time of print.
Under the Kibaran banner managing
director Andrew Spinks and team have
delivered a BFS on the Epanko project,
370km from Dar es Salaam, which is
forecast to produce 60,000 tpa natural
flake graphite products over an initial 18
years.
The operation is poised to gener-
ate annual EBITDA of $US44.5 million,
38.9% IRR and pre-tax NPV of $US211
million, with $US1 billion the forecasted
contribution to Tanzania.
German financier KfW IPEX-Bank was
mandated in April to organise a $US40
million senior debt funding, including
preparing an application for approval un-
der the German United Loan Guarantee
(UFK) scheme through Euler Hermes
AG.
KfW is among the European-strong
contingent interested in Kibaran’s efforts
with the likes of ThyssenKrupp AG and
EGT Europe joining Japan’s Sojitz Cor-
poration in sales agreements for Epanko
products.
Completing financing for the develop-
ment of Epanko is still a work in progress
for Kibaran.
“I think 2019 continued to be challeng-
ing in Tanzania, but we strongly believe
that the KfW financing is on the horizon.
We are working towards finalising the Andrew Spinks
loan documentation so we can organise prices (flake and carbon grade) and
all the debt financing with the German costs related to such things as purifica-
Government,” Spinks told Paydirt. tion and logistics which will feed into a “The feedback from all our European
Alongside efforts to lock in project fi- cost benefit analysis to determine the customers is that they have absolutely
nancing for Epanko, Kibaran is making optimal feedstocks required for the pro- have no issues with our product and they
good headway into its proposed EcoGraf posed Kwinana production. are very happy with Kwinana as a source
project, slated for development in Kwi- GR Engineering Services Ltd is han- of ethical and transparent raw materials,”
nana, Western Australia. dling the EcoGraf purification process Spinks said.
A benchmarking feedstock pro- flow sheet, with the completion of test “I think as we migrate into this renew-
gramme is nearing completion as part of work in January paving the way for able energy generation the emphasis for
pre-development activities for Kibaran’s preferred feedstocks to be determined greener minerals and more ethical prac-
proposed battery anode material manu- and the finalisation of binding purchase tices is going to be high. There is a re-
facturing facility, which is being designed agreements needed for debt financing quirement from the customers and I think
to produce battery graphite for the lithi- requirements. what is really encouraging us is that you
um-ion battery market. Kibaran hopes to move forward with a can’t go to a car or battery manufacturer
Product sources selected from a suc- final investment decision for the Kwinana that doesn’t talk about sustainability, low
cessfully run programme in 2018 are facility in the first half of 2020. carbon emissions, low CO2 footprint. It
currently being assessed and test work Spinks said the EcoGraf development, is very much their priority and our devel-
being conducted in Germany using spe- which has received strong WA State opments are very much matched to that
cialised equipment, including Kibaran’s Government support, is timely given the and that is the way we see demand mi-
spheronising pilot plant. weight of investment in Europe driving grating from Asia into Europe and obvi-
The scope of the company’s work in- the transition towards electric vehicles ously into the US.”
cludes evaluating production variables which will require alternative and respon- – Mark Andrews
and will give Kibaran an idea of purchase sibly produced raw materials.




aUSTRaLIa’S PaYDIRT DeCeMBeR 2019 - JaNUaRY 2020 Page 73

INDABA PREVIEW





Peak’s rocky road to a SML




anzanian rare earths hopeful Peak Re- Smith said the company’s recent deci- Smith said the company remained en-
Tsources Ltd has received the strongest sion to take on outright ownership of Ngual- gaged with end-users in Japan and Europe
indication yet its long-awaited Special Min- la was intended to make the project more on offtake of Ngualla products, with any po-
ing Licence (SML) could be awarded any attractive for institutional investors and de- tential binding agreement likely to be tied to
day now. velopment partners. project finance.
Following a four-day site visit to Peak’s In early November, shareholders ap- The time spent waiting for the SML to ar-
Ngualla project in October, including an proved a transaction involving Appian rive has afforded Peak the opportunity to
overview of the company’s regional com- Pinnacle Hold Co Ltd and International review aspects of its proposed operations.
munity initiatives, Tanzania’s newly formed Finance Corporation (IFC) rolling up their This included visiting Lynas Corporation
Mining Commission made a recommen- ownership interests in a Mauritian holding Ltd’s Malaysian processing facilities earlier
dation to Cabinet that a SML should be company into Peak. this year.
granted. “We hope that will appeal to somebody “I’ve got to give them kudos for what
While the exact timeline of the award who would want an ownership position of they’ve got accomplished,” Smith said.
remains unclear, Peak was told to expect the project and would be willing to support “If you look at Lynas and see how long it’s
a meeting with key government officials in the construction of the project going for- taken them to go from finance to construc-
November, with a deci- tion to operation to ef-
sion from Cabinet likely fective economics, it’s a
to be handed down be- pretty long window and
fore the end of the year. this is the lesson that’s
ASX-listed gold de- out there for everyone
veloper OreCorp Ltd is to look at.
also awaiting award of “You can’t simply wait
a similar licence for its until you need material
Nyanzaga project. and then say we need
It has been a frustrat- to turn on a rare earths
ing 2.5 years for both plant, you’ve have to
Peak and OreCorp with say to yourself ‘I’m go-
their respective applica- ing to need material at
tions submitted amidst this time and I need to
the upheaval of Tanza- be able to go back 3-4
nia’s mining legislation years before that and
in mid-2017. make the decision to
With negotiations be- start things up’. That’s
tween the Tanzanian where I think we’re at
Government and Bar- today and I think we
rick Gold Corp over the can make a very good
future of Acacia Min- case for why we should
ing’s assets seemingly be next on the list.”
coming to a peaceful Smith said the com-
resolution, Peak chief executive Rocky A long-awaited SML could be awarded to Peak’s Ngualla rare pany had also been
Smith expects other companies will now be earths project in Tanzania before the end of 2019 investigating financing
able to get back down to business. incentives offered by
“We got a chance to look at the frame- ward,” Smith said. various export credit agencies and gov-
work that Barrick has supposedly negoti- “We’re very happy with the support that ernments, including the UK, where Peak
ated with Tanzania prior to their purchase we’ve received from Appian and the IFC – plans to locate its refinery on a 40ha prop-
of Acacia and we were quite pleased with they were there at a time when we needed erty at Teesside.
what we saw there,” Smith told Paydirt. the money to start a BFS and a lot of our “I have to say this is probably one of the
“It seems as though those negotiations exploration drilling and other things of this best sites I’ve ever seen with respect to the
are coming to a completion, there’s only nature – but now we need to target other area, the people in the area, the cost of the
a little bit left to do I think, then we expect investors that want to be part of the con- land, the waste disposal, the reagent cost,
things will start to move forward in a more struction of the project. That’s not to say all the things that you really need for rare
progressive manner on the Tanzanian side. these two won’t be, it’s just more likely other earth production are in this area,” he said.
“I would say the framework that Bar- groups will have a bigger reason to be part “When we did our review of all the sites
rick has negotiated with Tanzania looks to of that process. around the world, we were surprised this
be very positive, much better than where “We recognise the fact that we may need was one of the sites that we were going to
we’ve got our economics currently pegged. a more creative approach to finance given end up with. And the more I’m there, the
So, that’s good news for us.” we’re in Tanzania, but we’re starting to see more certain I am that we made the right
Peak’s next moves have long hinged on people that are interested in supporting choices.”
the award of the SML, in particular its ability these types of projects, so I’m cautiously
to secure offtake and finalise project fund- positive about our ability to get financing, – Michael Washbourne
ing arrangements for Ngualla. either debt or equity, for the project.”


Page 74 DeCeMBeR 2019 - JaNUaRY 2020 aUSTRaLIa’S PaYDIRT



INDABA PREVIEW





Triton brings charm to Ancuabe




ozambique will be hoping it’s a case financing puzzle was coming together with round, is confident the company will begin
Mof third time lucky when Triton Miner- various approvals being received for Jinan producing at a time when the market is
als Ltd begins construction of its Ancuabe Hi Tech (JHT) to become the company’s ready to embrace graphite once again.
graphite project over the coming months. largest shareholder and funding partner. “There’s been some softness in the bat-
Triton is poised to become the third ASX- JHT, a major Shandong-based state- tery graphite space because of Syrah’s
listed company in two years to attempt to owned enterprise, has acquired Shandong struggles in production but also getting
bring a graphite project in Mozambique to Tianye Mining’s 19.3% shareholding in Tri- penetration into China and some resistance
life after Syrah Resources Ltd and Battery ton and is currently seeking MOFCOM ap- out of China, which wasn’t unexpected,” he
Minerals Ltd. proval for an additional investment of $8.5 said.
Syrah’s struggles, in particular its ability million to lift its stake to 34%. “China will close a lot of facilities down,
to sell product from its stuttering Balama “One of the attractive aspects of this deal but we’re taking an attack which is com-
mine, have been well documented. Weak- is Jinan will essentially be providing a fi- pletely different to Syrah because we’re not
ness in the graphite market was also cited nancing guarantee to finalise the rest of the targeting the battery market; we’re targeting
as the main reason for Battery Minerals financing for the project,” Canterbury said. the flame-retardant building industry and
managing director Jeremy Sinclair transi- “Jinan also have a leasing company and high-value products like that which have
tioning to a non-executive role last month, we will place all the equipment that is pur- held up much better. In fact, that part of the
with site works at the Montepuez project chased out of China through that leasing market is growing.
also scaled back while the company re- company, which effectively provides an- “Shandong was predominantly the large
configures its development timetable in line other $35 million of financing. flake graphite centre of China, but that is
with the predicted recovery in pricing. “Once you put all that together, there’s running out and hence why our two bind-
Triton undertook some early site works only a small missing piece to the financing ing offtake agreements are both with Shan-
at Ancuabe during 2018, but postponed remaining. There’s discussions happening dong graphite producers. Both have con-
further activity as soon as the financial with a couple of funds out of China who firmed they are running out of flake in the
markets started to cloud. According to are looking at a potential investment at the next couple of years.
managing director Peter Canterbury, the project level, so it’s highly likely through this “We think the growth potential in expand-
company’s development timetable is now transaction that we will not need to raise able graphite is significant and we believe
aligning with revised forecasts for a resur- any more funds.” we’ve got a project that looks very suitable
gent graphite sector. JHT, via its Australian associate compa- for that space.”
“The market has been a bit weak, but ny, has also provided Triton with two interim Canterbury said a JV partner was re-
we’re now starting to see a lot more discus- debt funding packages totalling $4.7 million quired to fund further studies on its Nican-
sion about expandable graphite and growth which will serve as a financial guarantee da Hill project, which reportedly hosts the
in that part of the market,” he told Paydirt. ahead of construction, as per the require- world’s largest graphite-vanadium deposit.
“We’ve effectively delayed 12 months, but ments of Mozambique mining legislation.
that was for market and financing reasons, Canterbury, who joined Triton three years – Michael Washbourne
but now we think we’ll probably get into the ago to initially spearhead its financial turna-
market and be producing 60,000 tpa at a
time where things will be pretty good.
“The general view is 2022 will be when
we start to see an uptick in pricing and also
the demand for the EVs will start to kick in.
By 2025 it’s estimated things are going to
be quite short, by which time we’ll be well
and truly up and going.”
Triton hopes to begin formal construction
works at Ancuabe in April/May following
the end of the wet season in Mozambique.
Based on current development timelines,
first production is expected in mid-2021.
According to the December 2017 feasibil-
ity study, a 60,000 tpa operation at Ancu-
abe will cost almost $US100 million to build
and generate an unleveraged pre-tax NPV
of $US298 million and IRR of 37%.
Payback will occur within 3.8 years of first
production, operating costs are estimated
at $US634/t and a reserve of 24.9mt @
6.2% TGC will underpin operations at An-
cuabe – 80km east of Pemba port – for at
least 27 years.
At the time of print, a key piece of Triton’s

Triton is preparing to start construction of its Ancuabe graphite
project in Mozambique during Q2 2020
Page 76 DeCeMBeR 2019 - JaNUaRY 2020 aUSTRaLIa’S PaYDIRT



INDABA PREVIEW Mali Lithium will release a DFS on its

Goulamina lithium project in early 2020
















Goulamina in the frameoulamina in the frame
G









y the time Mining Indaba rolls around costing, which will be really valuable to funding to develop the world’s largest un-
Bin early February, Mali Lithium Ltd see where we may have overdone it or committed hard rock lithium reserve.
(MLL) managing director Chris Evans will underdone it in the DFS. MLL has also started assessing down-
have a very clear picture of how much it “The thing we like about CHICO is stream opportunities for the project,
will cost to develop and operate a lithium they’re operating in 14 African countries commissioning Hatch Ltd to undertake a
mine at Goulamina. at the moment, they operate a bauxite scoping study on the viability of refining
A DFS on Goulamina – about 150km mine next door in Guinea, they’ve got lithium carbonate or hydroxide products
south of Bamako – is on track for com- an office in Abidjan, so they’ve got some on site at Goulamina.
pletion in Q1 2020 with a final investment real African experience and obviously “The general sentiment is that there is
decision on the project slated for the sec- they have good connections in China. It’s going to be a lot of consolidation in the
ond half of the year. definitely in their interests to see us find lithium market over the next 10 years and
Speaking to Paydirt last month, Evans the other partners we need – offtake and so a lot of people believe that it’s going
said the DFS was about three-quarters finance – so they are out helping to pro- to be difficult for a spodumene-producing
complete, including some key technical mote our project.” mine to just operate independently,” Ev-
aspects which have allowed tenders to MLL has also signed a letter of intent ans said.
be opened with potential contractors. with Changsha/Minmetals Corporation “It means a mine is going to have to
This ultimately led to MLL recently of China to discuss potential opportuni- be linked with a downstream processing
signing a MoU with Chinese state-owned ties in EPC contracting, offtake and pro- facility of some sort, either as part of its
construction and engineering company ject funding. own business or with a really strong part-
China Henan International Cooperation As it charges towards the end point ner. So, we thought we should find out
Group Co (CHICO) for an early contrac- of the DFS, MLL has resumed drilling at the metrics of actually doing some of this
tor involvement agreement. Goulamina in a bid to convert more of the downstream processing in Mali, to show
As part of the MoU, CHICO is set to inferred resource into indicated status, the market we know where lithium is go-
provide MLL with its own capex and as well as increase the 31mt @ 1.56% ing over the next 10 years and that we
opex estimates for Goulamina by the end lithium reserve. want to be part of it.”
of January, giving Evans and his team Since joining the company in February, Evans added that downstream pro-
the chance to compare those numbers Evans has strived to optimise multiple cessing in Mali was “not out of the bounds
against their own ahead of the official re- aspects of the project, including securing of reality” given the country – now home
lease of the DFS. a water licence to pump from the nearby to 12 commercial gold mines – boasted a
CHICO is preparing its estimates at its Selingue Dam and identifying alterna- very credential mining industry.
own expense. tives to diesel power generation. MLL has also resumed drilling at the
Evans said it was a boon for his com- MLL is also in discussions with trans- Koting gold prospect, part of the com-
pany to have a reputable contractor such port companies about the potential back- pany’s Massigui gold project, to test for
as CHICO interested in the project be- loading of concentrate to be produced at potential third-party feed for the nearby
fore all DFS numbers had been finalised. Goulamina. Morila mine run by Barrick Gold Corp.
“They realise that this is the perfect “A lot of material is coming into the port “Gold was once the main focus of this
time to get in early and assist us, so of Abidjan and being transported up to company and we still have some great
they’ve then got a whole lot of advan- Bamako, pretty much driving past our tenements that have had some explora-
tages once it comes to tendering time,” front door,” Evans said. “Those trucks are tion done on them, but not a whole lot,”
he said. then returning empty back to Abidjan, so Evans said.
“Of course, the beauty with CHICO is we’re in discussions now to see if we can “Any discovery on those tenements
they’re doing it all at their own cost be- load our material into those trucks which can be more readily monetised than a
cause they recognise the opportunity will save a lot of cost for us.” discovery in the middle of nowhere be-
here. They’re going to give us capital and With an exploitation (mining) permit cause within 20km there’s a processing
operating cost estimates just before the awarded in August, Goulamina is now plant.”
DFS comes out, so we’re effectively go- a fully permitted project, adding another – Michael Washbourne
ing to have a DFS costing and a real-time layer of confidence to MLL’s pursuit of


Page 78 DeCeMBeR 2019 - JaNUaRY 2020 aUSTRaLIa’S PaYDIRT

chec chec

chec chec

chec chec

chec chec

chec chec


























aUSTRaLIa’S PaYDIRT DeCeMBeR 2019 - JaNUaRY 2020 Page 79

INDABA PREVIEW

Tormin produced almost 60,000t of heavy mineral concentrate during Q3 2019


















MRC rides expansion wave





resh from renewing its existing mining “We’re investing heavily in the operations dividends to shareholders.
Frights at the Tormin minerals sands op- of the business and we’re looking forward to “We’ve paid out over 27% of all net prof-
eration in South Africa for another 10 years, seeing the first two phases of this expansion its that have come from mining the opera-
Mineral Commodities Ltd (MRC) is patiently completed by November 2020,” Fox said. tion, I’m not sure there is another miner with
waiting to hear whether its application to ex- “Throughout each of these phases, we a higher dividend yield than we have,” Fox
pand its concession will be granted. also intend to maintain our strong commit- said.
MRC is seeking to increase heavy mineral ment to our social, labour and community “It’s been a very lucrative asset for the
concentrate production at Tormin by mining programmes, and to this end, by this time company and it’s rewarded the shareholders
the Northern Beaches and Inland Strand next year, we will be reporting these pro- well. We had an 8c raise to essentially build
concessions. An application for environmen- grammes within the context of the GRI sus- the plant to put Tormin into production and
tal approval was granted in June, but that de- tainability reporting standards.” we’ve now paid off 6c in dividends.”
cision was subsequently appealed. Tormin, about 400km north of Cape Town, Fox said the company was encouraged
At the time of print, the mandatory 90-day began operations in January 2014 after by the progress it had observed in South
window for the appeal to be heard had ex- MRC raised $14.5 million for its develop- Africa’s resources sector over the past two
pired but MRC remained in the dark on the ment. At the time, the project had a resource years since the appointment of Gwede Man-
status of its application. of just 2.7mt, albeit with a grade of nearly tashe as Minister for Mineral Resources.
“We’re waiting and hoping we’ll receive a 50% heavy mineral. “There was a point in South Africa’s his-
favourable outcome and have that amended Over the next six years, more than 10.5mt tory where the company took active actions
mining right granted soon,” MRC corporate has been mined from the beaches of Tormin, to diversify out of the country and away from
development manager Peter Fox told Pay- yet MRC’s stated resource has only deplet- this asset because they were concerned
dirt. ed down to 2.26mt @ 14% heavy mineral. about the issues of being able to operate
“Subject to permitting, we could have all “In every year, we’ve mined 80% of our here and the delays they were encountering
this ready to go as early as Q1 next year. It’s stated resource and we’ve had an overcall with licences,” he said.
a really exciting expansion programme and of about 16% in the heavy mineral,” Fox said. “That’s certainly changed for the better
one we need to undertake if we’re going to Since 2016, MRC has also been paying and we’re very encouraged by everything
make the most of our investment in Tormin.” we’re seeing from Minister Mantashe.”
MRC’s three-phase expansion plan ini- MRC is now the owner of a second opera-
tially proposes relocating one of its beach tion – the Skaland graphite mine in Norway
concentrators to Northern Beaches during – and remains committed to developing the
Q1 2020 and increasing heavy mineral con- Munglinup graphite project in Western Aus-
centrate production to circa 700,000 tpa. tralia.
Construction of a new crushing circuit for However, there are no firm plans for the
the Inland Strand mining area headlines the undeveloped Xolobeni mineral sands pro-
second phase of the expansion plan, with ject on South Africa’s Eastern Cape. While
production set to be lifted to about 900,000 it boasts an impressive resource of 346mt
tpa during Q3 2020. @ 5% total heavy mineral, the project has
MRC is also considering adding a circa long been plagued by social and community
$US30 million mineral separation plant in issues.
2021 as part of the final phase of Tormin’s “It’s been very intensively debated and
expansion. This would see the company quite controversial about whether that area
produce finished garnet (150,000 tpa) and should be developed…so the company has
ilmenite (210,000 tpa) products. taken a step back from that asset whilst the
Capital to fund these phases is likely to be communities debate the pros and cons of
scheduled into upcoming workflows, with mining,” Fox said.
about $US2.5-3 million required to move
the concentrator early in 2020 and a further – Michael Washbourne
$US12-15 million needed for the new crush- MRC has applied for an expanded mining
ing circuit. right at Tormin, about 400km north
of Cape Town, South Africa


Page 80 DeCeMBeR 2019 - JaNUaRY 2020 aUSTRaLIa’S PaYDIRT

INNOVATIVE





THINKING







Receival, storage & feeding of bulk materials in one machine.










































 Lengths up to 56m  Belt slippage eliminated
 Lowest possible profile  Incline angles up to 25°
 Mistracking eliminated  Belt widths up to 4.0m

 Minimal spillage  One sided belt fastening





TRANSMIN SOUTH AFRICA
Represented in SADC by Carmaky Engineering





Local Call: +27 82 856 6852 Email: [email protected] www.transmin.com.au
Website: carmaky.com Email: [email protected]

INDABA PREVIEW





Emulating a golden run




f Golden Rim Resources Ltd manag- 783.8 g/t), 3m @ 7.2 g/t gold and 4m @ “The plan now is to see how big this
Iing director Craig Mackay ever needed 23.2 g/t gold from 67m (including 1m @ high-grade [mineralisation] is. When
reminding just how quickly a project can 65.7 g/t) at the Diabatou prospect. you’re getting some nice high-grade num-
move in Burkina Faso, he only has to look Mackay recalled how WAF’s run of suc- bers, everyone gets excited, particularly
over the fence to his closest neighbour. cess since early 2016 came on the back of when it’s in a new area. If there turns out
The neighbour is fellow ASX-listed West a similar set of high-grade results and he to be some size here, that will have a big
African Resources Ltd (WAF), which is set hoped Golden Rim was capable of repeat- impact on the next resource estimate that
to pour first gold from its Sanbrado project ing the trick. we do.”
by mid-2020. “Our nearest neighbour is West African Mackay said near-term exploration
Resources and we’ve watched them go would also focus on potential strike and
through that whole process, obviously first depth extensions of the resource, of which
getting the resource and then expanding only 14% is currently classed as indicated.
it,” he said. “Our existing resource ends at 115m
“Interestingly, they really got the project vertical below surface, but the pit opti-
going on a high-grade shoot and then misation work that we’ve done has sug-
we’ve seen them get the financing and gested that we could probably take that
take it forwards. When you can see that to about 150m, particularly at the current
and you can see the debt recognition in gold price,” he said.
the marketplace, it’s a positive pathway for “There’s also strike potential immediate
ourselves as well.” to the resource. In this ground that we’ve
At the time of print, Golden Rim had purchased next door, we can actually see
completed more than half of a planned on surface there’s about 500m of artisanal
500km IP and ground magnetic geophysi- workings extending from our resource into
cal survey at Kouri. Two IP anomalies as- the new area, so we’re going to be drilling
sociated with high-grade gold mineralisa- in that area and we believe that will add
tion have been detected. ounces to the resource.”
Three drill rigs – diamond, RC and au- Despite some of the security concerns
Finding more high-grade gold is the focus of ger – were also turning at site, with first which have emerged in Burkina Faso in
the current exploration programme results expected in late November. recent times, Mackay remains steadfast
Exploration is currently focused on an in his view that Golden Rim’s future lies in
area to the east of the defined 1.4 moz the gold-rich West African country.
Like Golden Rim, WAF has been a long- resource at Kouri. Golden Rim acquired “We really want to take this project for-
time resident of Burkina Faso but it wasn’t these neighbouring tenements earlier ward, look at these high-grade areas, ex-
until a high-grade discovery almost four this year, effectively increasing its ground pand the resource and ultimately take this
years ago that things really started to take holding fourfold. through the steps of scoping and feasibil-
off for the Richard Hyde-led company. “Our 1.4 moz resource previously end- ity,” he said.
Sanbrado will become the country’s ed on our eastern boundary, but with this – Michael Washbourne
13th commercial mining operation when ground that we’ve done the deal on we get
officially up and running, providing a ma- another 28km of strike in that direction,”
jor confidence boost to explorers such Mackay said.
as Golden Rim which are looking to find Golden Rim has resumed drilling at its Kouri project in Burkina Faso
something that can be mined.
While the company briefly flirted with
a zinc-silver-lead project in Chile a few
years ago, Golden Rim has not looked
back since returning to its roots in mid-
2017. And, according to Mackay, 2019 was
the company’s best year yet.
“We’re certainly seeing momentum at
the moment and there’s quite a bit of in-
terest in what we’re doing,” Mackay told
Paydirt.
“As long as we can keep some good
news bubbling along, I think it’s going to
be another positive next 12 months for us.”
Exploration at Golden Rim’s Kouri pro-
ject has resumed following the wet sea-
son, with the company eager to follow up
on several high-grade drilling results re-
ported in August, including hits of 7m @
121.2 g/t gold from 41m (including 1m @


Page 82 DeCeMBeR 2019 - JaNUaRY 2020 aUSTRaLIa’S PaYDIRT

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Mako swims towards resource




The Mako and Geodrill teams get ready
ako Gold Ltd managing director Pe- happy. If they’re not happy, you’re not go- for the resumption of drilling at the Tchaga
Mter Ledwidge has declined to put a ing to have a happy time of it.” prospect, part of the Napie project in Cote
timeline on when his company will unveil There is a strong sense of optimism in d’Ivoire, in late October
a maiden resource for its Napie project Ledwidge’s voice when he discusses the
in Cote d’Ivoire, despite the likelihood an mechanics behind how his team plans to
estimate will be calculated sooner rather reach the point where it can actually start
than later. calculating a resource estimate. were likely to switch their focus to the
Drilling has resumed at the Tchaga From his perspective, every drill pro- Gogbala prospect where 2km of minerali-
prospect – where a headline intercept of gramme must have a purpose and that is sation has already been outlined.
28m @ 4.86 g/t gold was returned earlier why Mako’s last campaign before the wet Respected West African-based firm
this year – following the end of the wet season focused exclusively on extending Geodrill has subscribed for up to $1 million
season. While the purpose of the pro- the mineralisation at Tchaga from 400m worth of Mako shares for up to 10,000m
gramme was to demonstrate continuity to 1km. RC (or equivalent in diamond and aircore)
of gold mineralisation within a 1km tar- And while it might be tempting to start drilling over a 12-month stretch.
get area, Mako’s ultimate goal is to get dreaming of a multi-million ounce gold Ledwidge said his company had
as close to a resource announcement as camp at Napie, Ledwidge said it was im- enough cash in its kitty – $1.77 million at
possible. portant to manage expectations of share- the end of September 2019 – for explo-
Ledwidge, who played a critical role in holders ahead of the initial resource be- ration work either side of the Christmas
the discovery of the Nabanga and Na- ing unveiled. break, although he is on the hunt for more
tougou deposits in neighbouring Burkina “I look back to West African Resourc- funding to underpin Mako’s longer term
Faso for Orbis Gold, acknowledged his es [Ltd] in the early days on the Sanb- ambitions in Cote d’Ivoire.
company must be seen to be moving to- rado project and their first resource was “There are some smaller funds that
wards delineation of an inferred resource. 400,000oz or so,” he said. “I was a share- have shown some interest in us, typically
“I’m a shareholder in a bunch of other holder then and I didn’t bail, I figured the ones that will put in $1-5 million to $10
companies, so I understand you need to that’s a damn good start, watched them million, so those are the ones I’m target-
hit those milestones for a company to be add to it and now their building a mine. ing to hopefully bring in some institutional
successful, so right now we’re really striv- “I think a big part of it is managing investors,” he said.
ing to get an inferred resource,” Ledwidge shareholders’ expectations. From 2008- “It’s a work in progress, but the good
told Paydirt. 2012, quite a few companies in Burkina thing is we’re getting a lot more attention
“I’m not going to give you a timeline on were announcing 3-5 moz @ 1 g/t re- now. In the last few weeks we’ve had a
that, but we think we can do that in a fairly sources, but that didn’t really work for little bit more liquidity, more volume in our
short term. Then the next step obviously many of them, even though everybody trading, which is going to be helpful.”
is to start doing a scoping study and go expected you to come up with those huge Mako has also applied for two new ex-
on to feasibility. numbers. ploration permits in Cote d’Ivoire which
“Because we do have a 17km shear, “For us, I’d be very happy for us to come it was hopeful of having granted before
it would be tempting to drill all over the out with a 1 moz resource – which seems Christmas.
place, but you’ve got to stay focused. I’ve to be the magical number for everyone – Work on the company’s Niou project
seen these companies that butterfly all but again I’m not saying that’s what we’re in Burkina Faso has been temporarily
over the place and announce good re- going to do.” parked, but Ledwidge said this was pri-
sults and their share price will go up for a More than 2,000m of RC drilling was marily due to Napie being far more ad-
little while, but shareholders do get impa- completed in this latest programme, in- vanced and the decision was made prior
tient and bail out of companies – just as I cluding infill drilling on previous sections to the recent terrorist attacks in country.
do – if they don’t go to the resource stage. and along the 1km mineralised strike – Michael Washbourne
“You’ve got to keep your shareholders length. Following this, Mako’s geologists


Page 84 DeCeMBeR 2019 - JaNUaRY 2020 aUSTRaLIa’S PaYDIRT

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Hon. Gwede Mantashe Hon. Lelenta Hawa Baba Ba Hon. Gesler E. Murray Hon.Samuel Urkato
Minister of Energy & Mineral Resources Minister of Mines & Petroleum Minister of Mines & Petroleum Vice President Exploration
Republic of South Africa Mali Ethiopia Shell Upstream













Robert Friedland Peter Major Caroline Donally Mark Bristow
Founder & Executive Co-Chairman Head of Mining Managing Director President & CEO
Ivanhoe Mines Mergence Corporate Solutions Denham Capital Barrick Gold Corporation













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CEO & President CEO & Founder Chief Executive Resources Editor
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INDABA PREVIEW





Maiden resource in 2020 for Exore




bulging cash position has enabled ing hits of 12m @ 4.37 g/t gold from 20m, Tremain told Paydirt the capital raising
A Exore Resources Ltd to maintain ex- 4m @ 18.52 g/t from 12m, 8m @ 3.74 g/t was part of a deliberate plan to keep Ex-
ploration and market momentum at a time from 32m and 8m @ 2.13 g/t from 32m. ore’s profile high in the market.
when much of the junior exploration sec- At the nearby Veronique prospect, “Our strategy from the start was to
tor has been in the doldrums. aircore hits of 4m @ 76.31 g/t gold from have plenty of money in the bank,” he
Exore only came into existence in Oc- 32m, 4m @ 9.6 g/t from 16m and 8m @ said. “The beauty of starting well-funded
tober 2018, shortly after securing access 4.42 g/t from 12m were followed up by a is that you are able to maintain momen-
to fellow ASX-listed Apollo Consolidated single diamond hole which produced 8m tum and ride out the market conditions.
Ltd’s two gold projects in northern Cote @ 7.74 g/t from 78m in fresh rock. We have not been too concerned with
d’Ivoire. The company had $15 million left Exore shares put on more than 25% on the market which has allowed us to push
over from a Portuguese lithium venture the back of such results and in late Sep- ahead with 80,000m of drilling in the last
taken during its time as Novo Litio and tember the company moved to secure its 12 months. It means we are generating
managing director Justin Tremain was cash position, raising $10 million in an in- results and therefore investor interest
determined to immediately apply those stitutional placement. which is a pretty good position for a junior
funds to the new assets.
The company drilled more than
80,000m in the subsequent 12 months, “ The beauty of starting well-funded is that
a highly aggressive campaign by junior you are able to maintain momentum and ride
company standards.
The programme produced a string of out the market conditions. We have not been too
shallow high-grade hits at both the al- concerned with the market which has allowed us
ready known Antonietta Central prospect
but also the previously undrilled Vero- to push ahead with 80,000m of drilling in the last
nique prospect on the Bagoe project. At 12 months. It means we are generating results and
Antonietta Central, Exore has defined
1km of high-grade mineralisation, includ- therefore investor interest…




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Page 86 DeCeMBeR 2019 - JaNUaRY 2020 aUSTRaLIa’S PaYDIRT

“We plan to come out with
a project resource, across An-
tonietta and Veronique, by the
end of the second quarter. We
were contemplating a resource
for Antonietta Central to show
as a milestone but particularly
after the last equity raising
there is less pressure to put a
maiden resource out and we
can get closer to a resource
which could be moved quickly
Justin Tremain into a feasibility study.”
In parallel, the company will
test peripheral targets at An-
explorer to be in given how tough the mar- tonietta and will begin explora-
ket can be for them.” tion on the newly signed Ten-
Exore’s work on Antonietta Central and grela JV to the north-west of
Veronique has been about quality over Bagoe.
quantity though. Such has been the pro- “We are still reviewing the
gress that Tremain is confident the recently historical data at Tengrela but
started RC/diamond drilling programme will there are definitely areas to get
deliver enough information for the company going on,” Tremain said. “We
to put together a maiden resource for the will do some surface geochem
two prospects. and stream sampling shortly.” While artisanal mining activity is extensive,
While Antonietta Central has already While Exore has started at a rapid pace, Exore’s Bagoe project has never been
seen enough drilling to form a JORC-com- Tremain is expecting a marathon as well as commercially developed
pliant figure, Exore would prefer to produce a sprint.
a global resource which includes both pros- “Our overall ambition is to define a few there has also been interest expressed.”
pects. million ounces here, enough for a stan- That operators across the region are
“Veronique is definitely the focus for the dalone operation and over the next nine looking at Exore is hardly surprising given
next six months and will receive 60-70% of months we hope to get halfway to that tar- it controls nearly 2,000sq km in what is cur-
the drill metres,” Tremain said. “This will be get,” he said. rently West Africa’s most popular explora-
the first ever RC holes put into it so there is Bagoe is located in the heart of Cote tion jurisdiction.
a lot of work to do to get it up to Antonietta d’Ivoire’s most prolific gold region and is “Cote d’Ivoire is becoming a preferential
Central. within 50km of Sissingue (Per- destination, particularly given the security
seus Mining Ltd) and Tongon concerns in Mali and Burkina Faso,” Trem-
(Barrick Gold Corp), two mines ain said. “West Africa as a general area has
with short mine lives. been tarnished by security issues but the
“That was always an attrac- people who are closer to it and the operat-
tion,” Tremain said. “Both those ing companies understand the differences
mines have hungry mills and between countries and that works in favour
will eventually require additional of Cote d’Ivoire. It has as good, if not bet-
feed so we do have that option- ter, geology than its neighbours but doesn’t
ality and fallback position, even have the same security issues and hasn’t
if it is not our ultimate goal.” received the same level of exploration fo-
Feeding mills via toll-treated cus.
ore from Bagoe could be a “Every company in the West African
quick-fix option for producers gold space has shown an interest in Cote
in the region but the increasing d’Ivoire.”
volume of West African M&A Exore’s preference is to fly solo, for now.
chatter suggests more decisive “Our view is that it is best to remain in-
action is also being considered. dependent and go it alone,” Tremain said.
Tremain acknowledged larger “The recent equity raise allows that and
companies had opened com- while we see merit in bringing in a corner-
munication with his company. stone shareholder, it does mean you are
“There is no denying the then fully committed to them in the long-
neighbouring operators have term and it is sort of a free option for them.”
reached out and are follow-
ing our results,” he said. “In a – Dominic Piper
broader West African context
Exore has drilled 80,000m of mainly aircore holes in
Cote d’Ivoire over the last 12 months
aUSTRaLIa’S PaYDIRT DeCeMBeR 2019 - JaNUaRY 2020 Page 87

INDABA PREVIEW





Invictus energised to unlock Zimbabwe



erth-based Invictus Energy Ltd is on able to tie up 250,000 acres in the most where junior explorers have taken on fron-
Pthe cusp of potentially breaking open prospective part of the Cabora Bassa, with tier exploration in oil and gas fields and
Zimbabwe’s oil and gas sector to the world. SG 4571 granted for a three-year period in essentially transformed the sector in the
Since Mobil called it quits in the coun- August 2017. respective countries.
try over 20 years ago, Zimbabwe has not The licence is renewable and since re- “If we are successful it will be huge for
been conducive to foreign investment in oil processing the dataset, Invictus has con- both company and country,” Macmillan
and gas, as well as other sectors. firmed elephant-scale potential in one of said.
The situation in country is vastly differ- the last undrilled rift basins in Africa. “If you look at the examples in countries
ent to the beginning of this decade, as the An EIA is in progress at Cabora Bassa, like Uganda and Kenya, discoveries in
“Zimbabwe is open for business” mantra which is prospective for 9.25 tcf and 294 those basins unlocked more with a [drill-
has been pushed hard in the past two million barrels conventional gas/conden- ing] success rate of 85%. We are chasing
years. sate (resource), as Invictus continues to a huge target, one of the biggest conven-
The changes to indigenisation laws, undertake a farm-out process. tional prospects in the world. If we are suc-
policies and regulatory frameworks make The company’s summation of the oil cessful with that first well, it will be country
the landscape in Zimbabwe more inves- market is positive, and it is anticipating a changing and it will have a big impact on
tor friendly, but the uptake from interested return to exploration activity across the the region from an energy perspective.”
parties has yet to reach any great heights. sector. The gas shortage in Southern Africa is
It appears Zimbabwe is still repairing the However, robust oil prices mean the de- well known and Zimbabwe is the gateway
reputational damage inflicted on the coun- mand for services will escalate, likely lead- and import/export corridor for Zambia,
try under the Robert Mugabe regime and ing to a spike on contract fees. Botswana, DRC and Malawi to the port of
with wider global economic uncertainty in- Invictus’s “aspirations for no-cost ex- Beira in Mozambique.
vestor risk appetite remains subdued. ploration” at Cabora Bassa, which hosts Zimbabwe is well placed to have an im-
However, as Invictus managing director the Mzarabani and Msasa prospects, has pact on the energy future of surrounding
Scott Macmillan explained to Paydirt, it taken the company down the path of at- African countries, as Invictus looks to im-
is important to understand the “lay of the tracting a partner to the project. part its knowledge further with potentially
land” in Zimbabwe before discounting the Invictus has estimated $US10 million value accretive assets in the East Africa
country as a potential investment destina- (dry hole) well cost at Mzarabani (prospec- Rift system and Karoo-aged rifts.
tion. tive for 8.2 tcf and 247 million barrels con- If the excess in demand and bids for the
“My family is still in business there, so ventional gas condensate) to test the huge company’s recent $1.5 million placement
from a hesitation point of view, it is more stacked, single well prospect. are any indication, existing and new share-
about reputation and being successful in Mzarabani is currently the largest un- holders are attuned to the strategy.
country. There’s a family legacy and his- drilled, seismically defined structure on- The cash injection ensures Invictus is
tory to live up to and I could have forged shore in Africa and now that Invictus has funded through the growth phase as farm-
a very different path and stayed with the started to engage with potential partners out discussions develop and preparatory
family business, but I fell in love with the oil there is a wave of excitement building in works for the on-ground exploration phase
and gas industry. I came to Western Aus- what ground-based activities will confirm. start. The CSR programme within the
tralia and went back to Zimbabwe in the oil “Our strategy for the next six months is community resulting from the completed
and gas sector to make a contribution to to advance the project through bringing EIA field survey, and government discus-
the country,” Macmillan said. in a partner in the farm-out process and sions on the petroleum regulatory frame-
“It can be daunting in flickering mo- moving to the ground phase of the work work continue.
ments, but it is exciting. If we are success- programme, which will include drilling,” Macmillan hopes the body of work In-
ful, we are going to change the country. It Macmillan said. victus has committed to will be comple-
is exciting, but it takes time and hard work.” One successful well could spark a fren- mented by other companies in the mining
As first mover in the space, Invictus has zied response from oil and gas hopefuls and oil and gas space in the coming 12
unlocked a $30 million dataset Mobil left flocking to Zimbabwe for a spoil of the months.
behind through modern technology with riches. “I would hope to see us further de-risk
the former owner/operator of SG 4571 in Macmillan pointed to a few examples our project and that there is more on the
the Cabora Bassa, in Zimbabwe’s north. in Uganda (Hardman Resources, Tullow) ground activity from mining and oil and gas
Being the only active oil and gas ex- Kenya (Tullow, Africa Oil Corp), Tanzania companies; a rising tide floats all boats.
plorer in Zimbabwe, Invictus has been (Ophir Energy) and Senegal (FAR Ltd) We’re not trying to keep Zimbabwe to our-


Invictus has a strong position in partnering negotiations
for its high impact acreage and has identified both the
market and potential partners to buy the product











Page 88 DeCeMBeR 2019 - JaNUaRY 2020 aUSTRaLIa’S PaYDIRT

Hon Winston Chitando




















































selves, we’d like to see other companies come to Zimbabwe and invest as well Did you know?
because that provides confidence to people that see the same potential invest-
ment that we do,” Macmillan said.
“I’d like to see broader investment across all sectors – minerals, oil and gas,
agriculture, energy – and people being more educated about Zimbabwe and un- Zimbabwe’s Indigenisation and
derstanding the huge potential the country has.” Empowerment Act allows for:
Macmillan believes that companies such as Invictus and lithium-hopeful Pros-
pect Resources Ltd have been able to advance their standing in the country l 100% foreign ownership of assets
because of their intimate knowledge of Zimbabwe, where the Government has l Guarantee of investor rights
moved to enforce companies to develop assets rather than continue to landbank
them. l 100% remittance of earnings
The stance on mining rights comes as Zimbabwe Mines Minister Hon Winston Special Economic Zone
Chitando was reported as saying that the Government had been “lax” in employ-
ing its “use it or lose it” policy. legislation enshrines:
It is believed some companies have not advanced projects on titles held since
the 1960s. l Legal and fiscal stability
“Zimbabwe is interesting because it has been off the map for 20 years, there l Five-year tax holiday. 15% corporate
hasn’t been any modern exploration techniques tested in the country across the tax thereafter
board,” Macmillan said.
“There has been a hiatus in exploration activity and if you think about changes l Zero capital gains tax
in the West Australian gold scene and what has been uncovered in the last 20 l Customs duty exemption on raw
years using more modern exploration techniques you can apply that into Zimba- materials and capital equipment
bwe as well.
“From a geological perspective, Zimbabwe is similar to WA, so there are a lot l Offshore banking and transacting
of people who are excited about it because there is untapped potential. I think we outside local financial system
are seeing a renaissance in Southern Africa. The security situation is much more safeguards against local currency
stable than West and East Africa so it is far easier place to be on the ground than effects
some other places.”
– M a r k A n d r e w s




aUSTRaLIa’S PaYDIRT DeCeMBeR 2019 - JaNUaRY 2020 Page 89

INDABA PREVIEW





MRG thinks big




RG Metals Ltd chairman Andrew Van
MDer Zwan expects his company to de-
liver a maiden resource of at least 1bt for its
Koko Masava heavy mineral sands project
in Mozambique.
An extensive aircore drilling programme
of more than 2,500m was wrapping up at
the time of print. Visual results to date have
been so encouraging that the company is
daring to dream of a resource to rival some
of its prolific neighbours, including the Rio
Tinto plc/Savannah Resources plc JV at
Mutamba.
Individual 3m sample intervals have re-
turned visual grade estimates of up to 8%
total heavy minerals and multiple consec- MRG’s visual analysis of drilling at Koko Masava has returned encouraging
utive 3m intervals of more than 6% total estimated grades of total heavy minerals
heavy minerals.
Full assay results are expected by mid- “We’re pretty comfortable this will get us Following the aircore programme, MRG
to-late February with a maiden resource to an inferred resource and I’m pretty com- was set to undertake infill drilling on closer
estimate to follow within about two months. fortable there will be in excess of 1bt, but spacing to see how much of the upcom-
“We’ve found grade at surface in all our what grade I can’t tell you. What I can tell ing resource estimate could be classified
drill holes and we’ve found a high-grade you is that it’s going to be big. as indicated.
zone generally running from below 10m “When you think about a 1bt resource, Aircore drilling was completed on 500m
down to 30m, so we’re expecting this to you’re talking about 50-plus years of min- by 1km wide spacing. To date, 20sq km of
stack up on a resource basis,” Van Der ing. Now that’s a big operation and some- high-grade heavy mineral sands has been
Zwan told Paydirt. thing in the realm of the big boys.” defined at Koko Masava.
























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Page 90 DeCeMBeR 2019 - JaNUaRY 2020 aUSTRaLIa’S PaYDIRT

Aircore drilling is set to deliver a maiden
resource of more than 1bt at Koko
Masava, Mozambique
Should the maiden resource estimate discovery of Mutamba and had previously
deliver on expectations, MRG will likely cast his eye over the Koko Masava tenure.
launch into a scoping study while drill test- “It’s great to get a project in middle of Af-
ing other prospective targets on its 631sq rica, but unless you’ve got the expertise to
km licence. do something with it, it can be problematic,
“The great thing about mineral sands is so that was one of the big pluses for us, to
that we can do this programme and get a have in-built expertise with the acquisition
resource,” Van Der Zwan said. “If we were and then bringing Mark on board full-time,”
doing a porphyry or gold tailings project, Van Der Zwan said.
we could be drilling for 1.5 years and “I’ve got no doubt we wouldn’t have pro-
spending millions of dollars to get to the gressed as well as we have so far without
same level of understanding. him because his community engagement,
“Koko Masava is just the first target local knowledge, the way he speaks the
we’ve drilled. Provided we get the grade language, is invaluable for us being a very
necessary – and all indications are that small team. We run a very lean operation
we have – a lot of things are looking really and to have Mark so comfortable on the
good.” ground in Mozambique and working with
MRG completed its move into Mozam- the people, we’re just rapt to have him on
bique at the start of 2019, having previ- board.
ously dabbled in early stage base metals “He seems to think this could end up be-
exploration in Sweden without any over- ing one of the best and biggest discoveries
whelming success. in the last 15-20 years in mineral sands,
Van Der Zwan said the company re- which is pretty exciting.”
viewed more than 200 projects around MRG could also benefit from govern-
the world before settling on this advanced ment-funded infrastructure which has
mineral sands opportunity, which appears been proposed for the region around
to have a number of synergies with Mu- Koko Masava, including a railway running
tamba. straight past the company’s licence to port
In a coup for MRG, the company also facilities on the Mozambican coast.
acquired the services of ex-Rio Tinto ge-
ologist Mark Alvin who was involved in the – Michael Washbourne












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INDABA PREVIEW





South32 not leaving South Africa




outh32 Ltd will divest ber, chief operating officer
Sits South African en- Mike Fraser said the com-
ergy coal assets in 2020 pany’s future in South Af-
but the fate of its remain- rica would be dependent
ing assets in the country on the country’s competi-
is still to be decided. tiveness and the Govern-
In November, South32 ment’s ability to overcome
announced it would sell current problems.
its 91.835% holding in “We see plenty of op-
subsidiary South32 SA portunities in South Africa
Coal Holdings Pty Ltd to create value in our op-
to South African Energy erations and ensure that
Coal, a subsidiary of this is shared more broad-
BEE group Seriti Hold- ly with our communities
ings Pty Ltd and two and our people – not only
trusts which will hold eq- through the taxes and
uity on behalf of employ- royalties we pay,” Fraser
ees and communities. said. “This is evident
Seriti will pay R100 through the work we’re
million (around $AUD10 South32 plans to keep its South African manganese division undertaking to strengthen
million) upfront and South32 will receive despite selling its coal assets in the country our suppliers, develop
49% of free cash flow until March 2024 skills for our employees
(capped at R1.5 billion). Kerr said the company’s manganese and within our communi-
However, the company is not intending smelters in South Africa and Tasmania ties and invest to provide much-needed
to depart South Africa completely and will were under pressure from competitors local infrastructure and services.
continue to operate its manganese and who had built new smelters which were “To ensure South Africa can compete
aluminium divisions in the country. tapping into subsidised and hydro power. globally for mining investment, the chal-
Policy and legislative changes have “We are looking at what the closure op- lenges that disrupt operations – power
had a negative effect on sentiment in the tions look like for both smelters,” he said. supply and cost of power, low productivity,
country’s mining sector in recent years, “A second option is, if we think the price organised protest action and illegal mining
but chief executive Graham Kerr said the is going to rebound, mothball them for a – must be addressed.”
Government’s new Mining Charter III and while. The third option is if someone else South32’s exposure to Africa has
MPRDA Amendment Bill had had no ef- is around who can make some money out waned since it was spun out of BHP Ltd in
fect on South32’s decision. On the con- of it. We have had a number of expres- 2015 and recent corporate moves would
trary, Kerr said, the deal with Seriti was in sions of interest but we have to under- suggest the trend will continue.
keeping with the spirit of the Mining Char- stand if they are real and what they look In August 2018 it acquired the Hermosa
ter. like. base metals project in Arizona, US and
“The Mining Charter has had no real “We need to explore all three options the company is also earning into the Tril-
impact on the sale of the South African and by the end of the first quarter next ogy copper project in Alaska.
energy coal assets,” Kerr told Paydirt at year we will be able to talk more about an Chair Karen Wood said the company’s
the company’s AGM in November. “When outcome.” preference for “expansion through the drill
you take into account our existing 8% BEE On its Hillside aluminium smelter, Kerr bit” would be focused on North America.
partner and the letter from the DMR stat- said power supply was the biggest con- “I wouldn’t say we would exclude the
ing we are the equivalent of 41% empow- cern. rest of the world but it [North America] is
ered because of transactions we have “Eskom has gone back to load shed- the preference,” Wood said. “It is more ge-
done previously. So, the lifting of that ding, that does concern us because Hill- ological than geopolitical but geopolitical
benchmark has no issues for our side. side is very much reliant on consistent issues around the world feed into those
“Our objective is to create sustainable power delivery,” he said. “However, we assessments.”
businesses where our employees and have a good relationship with Eskom at Kerr said the company was chasing its
communities benefit so that will absolutely the technical level. In all the years of load preferred geological settings.
be consistent with the Mining Charter. shedding we had very little impact on the “We have a bias to base metals and like
And, where Eskom is trying to go with smelter that wasn’t communicated. So, everyone else we like copper a lot,” he
procurement, its preference is for trans- we’re happy with how that works.” said. “If you follow the rocks, you’re in two
formation and development of new black Kerr said longer-term concerns were places; the Andes working up towards the
business, this deal ticks that box as well,” also being addressed. Rockies, or the DRC. However, the DRC
he said. “We have worked closely with Eskom is not a place for us to be operating in.
While South32’s departure from en- and we like to think that in the next six With our values, we think it is too difficult
ergy coal will be complete in the coming months we can have clarity about long- at the moment.”
12 months, the future of its South African term power contracts at Hillside,” he said.
manganese and aluminium businesses is Speaking at the Joburg Indaba in Octo- – Dominic Piper
still to be decided.


Page 92 DeCeMBeR 2019 - JaNUaRY 2020 aUSTRaLIa’S PaYDIRT

Kefi managing director Harry Anagnostaras-Adams, Ethiopian ‎Minister
for Mines, Natural Gas and Petroleum HE Samuel Urkato and ANS Mining
director Ato Demissie Demissie at Africa Down Under in Perth

Tulu Kapi another step closer




thiopian gold hopeful Kefi Minerals plc for the project was underway at the time flow starts, and project debt begins to be
Eis in a plum position to be developing of print. paid down.
the country’s first modern day commer- Kefi’s asset level partners at Tulu Kapi Kefi has also been allocated 1,000sq
cial precious metals mine. are to provide $US58 million of equity in km of exploration ground, which could
“It looks like the best environment since a staged investment into the project, with be prospective for satellite deposits to
Bretton Woods unlocked the gold price some of that money to be made avail- be added to development and production
in 1974 not only because of current price able to Kefi for corporate and exploration plans at Tulu Kapi.
and outlook, but because the role of gold costs. Furthermore, on the exploration front
has again institutionalised as a reserve Upon the planned project equity and Kefi has reported immediate success
currency,” Kefi managing director Harry debt financing closings, the project sub- from drilling at Hawiah in Saudi Arabia.
Anagnostaras-Adams told Paydirt. sidiary – Tulu Kapi Gold Mines Share Following assay results from the first
“It is strong in all major currencies and Company (TKGM) – will be self-reliant drill hole, which returned 15.8m of mas-
its contextual role is stronger than for a during the gold mine development phase sive sulphide from 150.75m depth (true
long time. The probability on the upside and exploration programmes will also be width 8m) @ 1.2% copper, 0.51% zinc,
seems greater than on the downside, as funded for that two-year period of con- 0.51 g/t gold and 9.1g/t silver, Kefi has
things stand.” struction. also reported striking massive sulphides
Amid remarkable transformation both A mining licence was granted for Tulu in the second and third holes.
politically and economically in Ethiopia, Kapi – 15.4 mt @ 2.1 g/t gold contain- It is a promising beginning for Kefi in
Kefi, the Government, local investment ing 1.1 moz reserves – in 2015 and open Saud Arabia given the 2,500m scout drill-
company ANS Mining, Lycopodium Ltd pit gold production at a rate of 140,000 ing programme has already confirmed
and Perenti Ltd are partnering to develop ozpa over an initial seven years at AISC that VMS mineralisation is the source of
the Tulu Kapi gold mine in the country’s of $US800/oz is scheduled to begin in the previously reported 5.5km-long geo-
west by 2021. late 2021. physical anomaly and that the minerali-
On the Government finalising its ad- Meanwhile, a PEA underpinning a po- sation is copper, gold and zinc-bearing.
ministrative arrangements for the devel- tential underground mining scenario ad-
opment of Tulu Kapi in November, clos- jacent to the open pit is potentially viable – Mark Andrews
ing pre-arranged project equity financing once the mine is in full flow, positive cash


aUSTRaLIa’S PaYDIRT DeCeMBeR 2019 - JaNUaRY 2020 Page 93

INDABA PREVIEW Meet the





Rutile adds to Sovereign’s sizzle




overeign Metals Ltd has set tongues wagging with the first team
Squantitative drilling results from its emerging rutile discovery in
Malawi.
Shares in Sovereign jumped 25% in early November on the back
of the release of intercepts of 13m @ 1.08% rutile (including 6m
@ 1.25%), 8m @ 0.92% rutile (including 5m @ 1.06%) and 5m @
1.16% rutile from broad-spaced drilling at the Railroad prospect. at Mining Indaba
Sovereign believes the mineralised footprint at Railroad is at least
1.6km long, 300-500m wide and remains open to the south-west.
Drilling was continuing at the time of print and a rig is expected
to soon target a large, high tenor soil anomaly over 3km wide at the
neighbouring Railroad West prospect.
Sovereign has been advancing the rutile potential of its 4,000sq
km ground package in Central Malawi for almost 12 months, hav-
ing decided to defer further technical studies on its promising Ma-
lingunde graphite project until a suitable offtake/project financing
partner is identified.
Iluka Resources Ltd, via its wholly owned subsidiary Sierra Ru-
tile Ltd, is the world’s only primary producer of rutile, a major ingre-
dient in the $US15 billion titanium pigment industry.
Sovereign managing director Julian Stephens said the recov-
ered rutile grades returned from his company’s ground were com-
parable with Sierra Rutile which has a global resource of 714mt @
1.1% rutile in Sierra Leone.
“Like anything, you can talk about potential as much as you like,
but we understood that we needed to show it and I think we’ve




Sovereign has returned encouraging results from initial exploration
29 30 FINDING, PLANNING
Cu Zn AND BUILDING THE for rutile on its large ground holding in Malawi
Copper Zinc MINES OF
ASX: ORN | JSE: ORN THE FUTURE


Developing a 21 done that with these first quantitative drill results from our Railroad
st
Next generation century South African prospect,” Stephens told Paydirt.
Leveraging new generation copper-zinc mine
technology and existing infrastructure “It is still a work in progress, but the market does like it. Unfor-
to deliver a new operation in the tunately, some people don’t understand, one, mineral sands and,
footprint of historic mine two, rutile specifically, very well because it’s a relatively modest
market in terms of total tonnages produced per annum and it’s also
Globally significant VMS resource an industrial mineral so you don’t have LME prices or the like.”
[email protected]% Cu and 3.7% Zn with Sovereign will target an initial resource from both Railroad and
initial 10-year, 2.4Mtpa operation Railroad West.
targeting 22ktpa Cu and 70ktpa Zn The rutile is hosted in the same soft, friable saprolite material
which underpinned the low-cost graphite mining and processing
Strong economics assumptions made about Malingunde.
BFS outcomes include A$1.1B Stephens, who has been exploring various projects in Malawi for
pre-tax free-cashflow; Pre-tax NPV8% more than a decade, said the country was striving to attract further
of A$574M; All-in-sustaining margin foreign investment into its fledgling mining sector.
of 44% “The Government has recognised, probably over the last five
years, that there is significant potential for mining to add to the GDP
Approvals near completion of the country so they’ve put in place a number of programmes and
Repli Environmental Authorisation some legislation to assist in that,” he said.
granted in July 2019 and Repli Mining “They’ve been highly supportive of Sovereign since we’ve been
Right granted in August 2019
there. We’ve got great relationships with government and they are
very, very keen for more mining operations to get up and going
in the country.”
www.orionminerals.com.au
– Michael Washbourne



Page 94 DeCeMBeR 2019 - JaNUaRY 2020 aUSTRaLIa’S PaYDIRT

Meet the







team







at Mining Indaba
























Bill Repard Christine Oelschlaeger Namukale Nakazwe
ExECutIVE ChAIRMAN AfRICA DOWN uNDER AfRICA DOWN uNDER

M: (+61) 418 768 578 M: (+61) 420 225 058 M: (+61) 450 508 836
E: [email protected] E: [email protected] E: [email protected]



















Dominic Piper Richa Fuller Michael Washbourne
EDItOR ADVERtISINg MANAgER JOuRNALISt
M: (+61) 424 934 494 M: (+61) 433 594 404 M: (+61) 400 956 703
E: [email protected] E: [email protected] E: [email protected]






www.paydirt.com.au

INDABA PREVIEW





Prediction proves resolute




redictive Discovery Ltd managing di- permit, following a longer than expected nificant production opportunity.”
Prector Paul Roberts found an unex- wet season in Cote d’Ivoire. Further exploration at Boundiali, where
pected side benefit to Resolute Mining Ouarigue South has been described past drilling returned 20m @ 10.5 g/t and
Ltd’s $US305 million takeover of London- as a mineralised body up to 100m wide 30m @ 8.3 g/t at the Nyangboue pros-
based Toro Gold in late July. and at least 210m long with a best in- pect, is also understood to be on Reso-
Toro had been Predictive’s long-term tercept of 45.3m @ 3.16 g/t gold from lute’s agenda.
JV partner in Cote d’Ivoire and momen- 45.9m, including 9m @ 10.3 g/t. While Roberts will keep a close eye
tum appeared to be building on the ex- Roberts said gold-in-granite had been on how Resolute exercises the drill bit
ploration front following a breakthrough observed at Ouarigue South, something in Cote d’Ivoire over the next 12 months,
discovery at one of the key prospects in he believed would bode well for reliable his attention will be directed towards ex-
early June. calculation of future resources. ploration of Predictive’s 100%-owned
As far as Roberts is concerned, very “We’ve seen gold-in-granite before ground in neighbouring Guinea.
little – if anything – has changed for and we’ve seen the good continuity you Predictive holds 500sq km of ground
his company despite Toro’s JV rights can get out of gold-in-granite and cer- in Guinea, headlined by the Kaninko and
over the 2,344sq km of granted permits tainly that’s what we’re seeing in Ouar- Kankan projects, having swooped on a
changing hands. igue South,” he said. suite of available tenements earlier this
“Over the last 12 months there has “Also it looks as if the mineralisation year as the company seeks to make a
been an increasing focus from Toro to- will continue on at depth. We’ve only discovery in its own right. All tenure is
wards Boundiali and Ferkessedougou drilled it to about 100m vertical at this hosted within the Siguiri Basin which
North and there’s no sign from what I’ve point, so there’s certainly room to move hosts AngloGold Ashanti Ltd’s plus-10
seen that Resolute has a different view,” downwards. It looks as if it can get big- moz Siguiri mine.
Roberts told Paydirt. ger and it looks reasonable to expect that At the time of print, Predictive was
“Their style is of course a bit different, we’ll get deeper as well. collecting samples from artisanal mine
but the biggest advantage from my point “There’s a lot of opportunity to find dumps around Kaninko to determine
of view is that their office is just down the more gold and we know there are other the optimal locations for drilling in early
road [in Perth] rather than being in the granites. It’s not just one granite in that 2020. Initial results included sampling of
UK, so we can get together pretty easily whole 17km of strike. How many more a spoil from a 2m wide quartz vein which
to talk about exploration programmes.” is only speculation, but certainly we’ll returned a peak value of 52.1 g/t gold.
Roberts is champing at the bit for be looking at four or five of those in that “There aren’t a lot of western com-
diamond drilling to resume at Ouarigue zone. If that’s the case, then we’re talk- panies in Guinea, but when there have
South, part of the Ferkessedougou North ing about the possibility of a pretty sig- been there’s often been a focus on pick-
ing up ground where there are lots and
lots of artisanal workers,” Roberts said.
“We’re quite interested in seeing lots
and lots of artisanal workings too, but
we know from our own experience that
the best deposits sometimes have no
artisanal workers on them or sometimes
they’ve got a historical working that has
been left behind.
“One of the things we like about Guin-
ea is we’re able to apply for more ground
in areas that we think have all the right
ingredients for finding something big-
ger than has been found already. For a
greenfields explorer, Guinea is a very
happy hunting ground.”
Roberts said his company was await-
ing feedback on projects it was interest-
ed in acquiring in Guinea, a destination
he believed had welcomed Predictive
with “very open arms”.
“We’ve found our timing has been quite
good and we’ve come into Guinea at a
time when the Mines Ministry is very ac-
commodating and positive to help com-
panies that are serious about getting on
the ground and doing work quickly,” he
said.
Artisanal miners in action at Bankan Creek, part of Predictive Discovery’s Kaninko exploration – Michael Washbourne
permit in Guinea


Page 96 DeCeMBeR 2019 - JaNUaRY 2020 aUSTRaLIa’S PaYDIRT

Wherever we are...





trend with us


















#paydirtmedia #magazines #conferences










Cardinal Resources Ltd exploration manager Paul Abbott with Paydirt deputy editor Mark Andrews,
Bolgatanga, Ghana, 2019
aUSTRaLIa’S PaYDIRT DeCeMBeR 2019 Page 97

REgIONAL ROuNDuP Rafaella hopes to have the Santa Comba tungsten afaella hopes to have the Santa Comba tungsten
R
project in production as soon as possibleroject in production as soon as possible
p























Rafaella welcomes tungsten revival





ear-term developers such as Rafaella off. We’re hoping that will work its way investor in the recent $2.8 million place-
NResources Ltd are hoping tungsten through the market and the price of tung- ment.
prices continue their slow but steady re- sten will rebound back to the levels it was “The great thing about this project is
vival following a torrid period for the rare a year ago. we don’t have any long lead items,” Turn-
metal. “Fundamentally, when we look at tung- er said.
ATP tungsten prices were command- sten we see a bullish market. There’s not “Normally you’re doing all this in the
ing almost $US230/mtu at the time of a lot of new production coming on stream background of trying to get a mining
print, up 25% since early September. It and yet tungsten tends to grow in de- permit in place or environmental permit
was the first notable increase recorded mand by a couple of percent each year. I done and those can take you a year or
since May when the price suddenly think certainly it’s one to watch. Tungsten more. We don’t have any of those delays
dropped by $US60/mtu and eventually has the ability to spike pretty quickly and or long lead items to deal with and we
hitting a three-year low in July. our strategy is certainly to be in produc- have a substantial amount of processing
Tungsten had seemingly been on an tion for when that comes.” kit in place.
upward trajectory since late 2016, but Spain appears to be a hot spot for “Really the only thing standing in our
shortly after edging $US350/mtu in mid- new tungsten developments with Santa way to starting production is the mine
2018, prices began to tail away. Comba third in line behind Barruecopar- plan, which is subject to better definition
Rafaella completed its acquisition of do (Ormonde Mining plc) and La Parrilla around the resource and the process
the Santa Comba tungsten project in (W Resources plc) as new projects im- flowsheet. Therefore, it’s as simple as
north-western Spain just before prices minently set to become operating mines the sooner we get this up and going, the
started to move in a positive direction. in the country. sooner we can get into cash flow and the
At the same time, the company quickly Barruecopardo and La Parilla have less shareholder money we’re wasting
raised $2.8 million to begin feasibility both entered the commissioning phase on working capital.”
work on a potential restart of the historic and while those two projects are double Rafaella hopes to unveil an updated
operation and to kick off a drilling cam- the size of Santa Comba, Turner said resource at the end of the current pro-
paign for an upcoming expansion of the their respective developments boded gramme which is comprised of both infill
existing resource. well for Rafaella’s plans. and regional drilling. Local drilling con-
From Rafaella managing director Ste- Turner formally joined Rafaella upon tractor Geonor Sondeos y Peforaciones
ven Turner’s perspective, the only thing the company completing its acquisition SL is overseeing the programme, with
standing in the way of his company re- of Galicia Tin & Tungsten SL, the past the team based just 60km from the pro-
suming production at Santa Comba is a owners of Santa Comba, for 17.5 million ject.
better defined mine plan. shares at 20c. Two further tranches of 30 First assays from diamond drilling re-
While his company is not immediately million shares will be issued to the origi- turned intercepts of 7m @ 0.221% tung-
impacted by movements in the tungsten nal vendors upon achievement of certain sten from 39m (including 3m @ 0.359%
price, Turner is keeping a close eye on milestones, including the resource up- from 43m) and 18m @ 0.12% tungsten
how the markets are reacting, especially grade and debt financing being secured from 64m (including 3m @ 0.305% from
if Rafaella wants to become a producer for development. 64m) outside of the existing resource.
sooner rather than later. Having been involved with the pro- Tomra Sorting GmbH and Grinding
“Obviously as we move into production, ject since 2016, Turner was instrumen- Solutions Ltd have also been appointed
where the tungsten price sits is going to tal in signing global commodities trader to respectively undertake ore sorting and
be critical for us,” Turner told Paydirt. Transamine Trading SA as an offtake metallurgical test work programmes for
“We have seen a good strengthening partner and ensuring the deal was car- input into the feasibility study which is
of the tungsten price in general, which ried over to Rafaella in the transaction. being managed by seasoned tungsten
had fallen away in the last few months All awarded permits also have been mining expert John Webster.
because of a big overhang of stock transferred across to the new owners.
in China that was recently auctioned Transamine was also a cornerstone – Michael Washbourne



Page 98 DeCeMBeR 2019 aUSTRaLIa’S PaYDIRTage 98 DeCeMBeR 2019 - JaNUaRY 2020 aUSTRaLIa’S PaYDIRT
P

EuROPE


Highfield closes in




on Muga



ighfield Resources Ltd is in a strong around the world outside the hands of ma- may be able to start some construction
Hposition to have a financing solution in jors, putting Highfield and Muga in a unique work,” Crookes said.
place for its Muga potash mine develop- position as one of only two potash mines Several debt and equity options are avail-
ment in 2020. in the premium Southern European market. able to Highfield to fund Muga and with
Highfield expects to have permits for a Highfield released significantly improved $44.9 million cash to the end of September
mining concession and construction, sub- project economics in October, including along with firm support from EMR Capital to
mitted to Spanish authorities, in December. identifying the opportunity to bring forward maintain its 30% shareholding and Austral-
Work on securing approvals for mining production of commercial vacuum salt, the ian Super (5%) locked in, the company is in
and construction of Muga tailed the grant- early start to residue management and a financially robust position and has a clear
ing of an environmental permit in the form treatment of by-products. path to project construction.
of a Declaración de Impacto (DIA) from the Equipment needed for an earlier start Also running in the company’s favour is
Ministry for Ecological Transition in June. to backfilling to enhance residue manage- the view that growth of the potash sector,
Highfield chief executive Peter Albert ment means that will become an upfront which is on a current trajectory of 2.5-3%
said receiving the DIA was a paradigm shift capital requirement and not part of sustain- pa, will be sustained.
for the company and it had quickly moved ing capital, while minor cost increases in Muga’s 1 mtpa MoP production profile
into development mode with the appoint- process plant equipment means capex of can enter the global market largely unno-
ment of Spanish national Leonardo Torres- €576 million (phase one €368 million and ticed and is earmarked for destinations in
Quevedo Angoloti as project construction phase two €208 million) is slightly higher Brazil, Europe and Africa in the future.
director while in the September quarter than 2018 costs of €541 million. Given Muga’s location in the north of
Jorge Feito Huertas joined as technical However, the updated project economics Spain, spanning the Navarra and Aragon
manager mining. see better C1 FOB costs €82/t (previously provinces, accessing such markets can be
Following the DIA, Swiss-based agri- €104/), NPV of €1.97 billion (€1.16 billion) done at a low cost.
business Ameropa AG signed a non-bind- and IRR 25% (23%). “Location is everything, there are great
ing MoU to take 250,000 tpa muriate of pot- “We’ve enhanced the flowsheet and infrastructure benefits with being in Spain
ash (MoP) from the 1 mtpa Muga mine in managed to significantly improve the pro- which allows for a low capital intensity.
Spain’s north. ject economics and now we have a good Also, the shallowness of the deposit, about
Under the agreement, Highfield has the by-product [salt] credit now,” Highfield 350m from surface, allows for a low capital
option to increase its delivery to Ameropa chairman Richard Crookes told Paydirt in intensity. Having low operating costs pro-
– a global agri-focused business with inter- Perth recently. vides some protection in the event of any
ests in production, logistics, marketing and The process plant improvements were weakness in the market, while the low cost,
distribution – to 300,000 tpa of standard achieved through test work by GEA Messo high sales price gives us a high margin,”
and granular MoP. GmbH and K-UTEC from Germany, while Crookes said.
The potential deal with Ameropa pro- Barcelona-based Grupo IDP is now en- Demand for MoP, the most common fer-
vides Highfield with leverage to a partner gaged in detailed design engineering for tiliser used in vegetable crops such as corn,
whose expertise is in physical trading of the process plant. is expected to increase in-line with food re-
fertilisers and grains, which will serve Muga As the engineers get to work, Crookes quirements for a growing population.
well during the early years of production. and co. will be ramping up efforts to deliver While there has been softness in pot-
While Highfield has the potential to en- a funding scenario for Muga. ash prices in the back half of 2019 (plus-
hance its capabilities and understanding of The company has previously had debt $US250/t standard MoP and well in excess
the MoP market, the agreement triggered credit totalling €185 million approved by key $US300/t granular in October), European
interest within the broader potash sector European banks. prices are at a premium compared to other
as other possible off-takers – wholesale “Hopefully they will refresh that next year markets, another likely advantage for Muga
customers, distributors and global traders – and we will try and do it in the most non- product when it is ready for market.
came to realise how far advanced and de- dilutive way. Hopefully by mid next year
risked the project was. [2020] we will be able to pull the financing – Mark Andrews
Furthermore, there are few MoP projects together and depending on permitting we


Highfield was on track to submit a mining
concession and construction permit for Muga,
northern Spain, by the end of December














aUSTRaLIa’S PaYDIRT DeCeMBeR 2019 - JaNUaRY 2020 Page 99

REgIONAL ROuNDuP





Lithium producers optimistic as



Fernandez set to take power




rgentina’s lithium producers are cau- pected” election result. history of them operating in Catamarca, par-
Atiously optimistic that President-elect Al- “It didn’t really matter who won, both par- ticularly Galaxy [Resources Ltd] and Galan
berto Fernandez’s incoming administration ties were looking at how they could increase [Lithium Ltd],” she said.
will not restrict capital flows or set other poli- exports from Argentina to overseas mar- “Catamarca has no security issues, it is
cies that could hamper their ability to supply kets,” Promnitz said. safe to operate in. There are hundreds of
the electric vehicle battery metal. “One of those exports is oil and gas, par- professionals and tradespeople to work.
Fernandez, a member of the Peronist ticularly their oil shale reserves, and the oth- Argentina is a federal system and each
party that has supported more economic er is lithium. Lithium has been supported al- province has different attitudes to mining.
intervention by government, defeated busi- most regardless of the Federal Government, Catamarca is very supportive towards inter-
ness-friendly incumbent Mauricio Macri in mainly because of the way things work in national mining companies.”
the presidential election on October 27. Argentina. It’s like the US, it depends on Argentina became one of the cheapest
The last Peronist president, Cristina Kirch- the province and the big three – Jujuy, Salta places to produce lithium from brines when
ner, imposed strict standards for several and Catamarca – are all very supportive of Chile raised industry royalties last year.
industries, including lithium, limitations that lithium brine production. That’s a benefit for Argentina, where many
slowed Orocobre Ltd’s buildout of a lithium “Alberto Fernandez actually flagged dur- lithium producers are sending in capital, not
project in South America’s second-largest ing the election campaign that he considered looking to pull out, according to Livent Corp
economy. it an opportunity for the development of lith- chief executive Paul Graves.
Fernandez so far seems keen not to mim- ium and there was a roundtable meeting in “The election really does not change our
ic that approach. He vowed earlier this year Buenos Aires before the election which was expansion plans,” Graves said.
to support lithium investment. attended by various members of the lithium However, other parts of Argentina’s mas-
The 60-year-old, who was chief of cabinet industry, including our local representatives. sive commodity sector remain anxious, with
during the entirety of Néstor Kirchner’s presi- That sort of proactive approach is a sign they sales of corn and soybeans jumping com-
dency and also in the early months of Chris- will continue supporting the lithium industry.” pared to 2018 on worries of possible export
tina Kirchner’s reign, is set to take office on Other executives also noted the three tax increases.
December 10. His cabinet choices will be provinces with the largest lithium deposits
closely monitored by all lithium producers have long had Peronist administrations that – Reuters with Paydirt staff
and developers in Argentina. work well with industry.
Lithium Americas Corp is developing a “Locally and provincially in Argentina, we
lithium project in Argentina’s Jujuy province see no concerns on doing business,” Neo Galaxy Resources Ltd will focus
with Ganfeng Lithium Co that is expected to Lithium Corp chief financial officer Carlos on cutting costs and volumes at
open in 2021. Vicens said. its flagship Mt Cattlin lithium mine,
Speaking on the sidelines of the Bench- Promnitz also noted the appearance of Western Australia, in 2020 following
mark Minerals Intelligence EV supply chain representatives from Catamarca province weak market conditions in the sector. In
conference in Los Angeles in mid-Novem- – where both Lake and Neo Lithium are de- an ASX statement, Galaxy said it would
ber, Lithium Americas Corp executive vice- veloping projects – at a mining conference implement a lower activity mine plan
chairman John Kanellitsas said: “We remain in Melbourne just days after the presidential at Mt Cattlin to maintain positive cash
committed to advancing our project on our election, suggesting their attendance was margins and preserve resource life.
timeline. We’re not taking our eyes off the another good sign for Argentina’s resources Galaxy expects to reduce the amount
ball.” sector. of material mined by about 40% while
Orocobre spokesman Andrew Barber Speaking to Paydirt at the event, outgo- forecasting lower output for the full year.
said the company looked forward to working ing Catamarca governor Lucia Curpacci
with Fernandez. said the province would continue to wel- Australian lithium miners have come
Lake Resources NL managing director come Australian miners. under pressure in recent months amid
Stephen Promnitz told Paydirt it remained “They have a long history of mining and plummeting prices for the metal, with
business as usual following the “not unex- exploration in Australia and there is a long demand for the battery component
falling after Beijing altered its subsidies
to EV makers and a rise in global trade
tensions.
Meanwhile, Galaxy is targeting a final
investment decision for the first stage of
its Sal de Vida lithium and potash brine
project in Argentina by mid-2020, with first
production in 2022.
Despite near-term headwinds to prices,
Galaxy said the current volatility in China
new energy vehicle sales is transitory
and it was forecasting double-digit growth
Argentina is one of the world’s lowest-cost producers of lithium from brines in global lithium demand over the next
decade.
Page 100 DeCeMBeR 2019 - JaNUaRY 2020 aUSTRaLIa’S PaYDIRT


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