Monday, March 4, 2024

Mowana mine to increase production by more than fivefold

African Copper Plc, the exploration company turned miner, said it will double its production by more than fivefold and use a sharp knife against production cost within the next four year at its novice mine.

The tri-listed copper miner on Botswana, London and Toronto stock exchanges said that production at Mowana mine is expected to grow from 5,500 tonnes this year to a pick of 29,000 tonnes while at the same time production costs will be slashed from US $ 2.48 (about P 15.00) per pound to US $ 1.49 per pound.

“The estimated production growth that the Mowana mine is able to demonstrate is outstanding when compared to other copper mines globally,” the Chief Executive Officer of African Copper, Joe Hamilton, said.

The move by African Copper was loudly applauded by analysts who said that the project seems destined to be more profitable than was previously thought.
“It shows that there is a lot of confidence in the project and it looks like it will be more profitable than originally thought,” an analyst at Capital Securities, Leutlwetse Tumelo, said Thursday.

African Copper’s Mowana mine ÔÇô some 100 kilometers west of Francistown at Dukwi ÔÇô is expected to start production in April, a move which will increase some economic activity in the northern parts of the country. It is thought that the mine will have a life-span of 17 years of open pit and the possibilities of underground mining are being investigated.

“The new production schedule has the potential to generate higher production, lower costs and defer additional capital requirements for two years,” the company said, adding that “production is expected to be 11 percent higher in the first five years of the mine.”

In a bid to reduce costs, Mowana mine will defer the installation of a Dense Media Separator until 2010 when there would be enough supergene and sulphide material available.

That means between 2008 and 2009 only higher grade oxide will be processed while the lower grades will be stockpiled. That will save the company some US $ 13 million which is the associated cost of the machine. The move will see benefits on two sides – ducking out of the DMS capital expenditure and full utilization of the processing plant at the optimum against the 65 percent or lower which would have resulted if the concentrate would have been used from the word go.

“These factors (would have) resulted in higher expected cash costs and reduced estimated revenue in the start-up years,” the company said.

As part of the plan to drive the mine into profit-making level, from inception, it will involve combined initiatives of better grade and higher throughput of supergene and sulphide material.

“African Copper personnel have confirmed that producing lower grade copper in a concentrate leads to higher recoveries and production. Revenue is maximized at 60 to 70 percent oxide copper recovery, producing a 21 to 25 percent copper concentrate. The reduction in concentrate grade results in an estimated 11 percent increase in the production of copper concentrate during the first five years of Mowana mine, positively impacting revenue and cash-flow,” the company said.
African copper also has about 4000 km2 of prospecting area covering Makala, Matsitama and Nakalakwana which has been described as the target area.

“We are excited by the recent exploration success to the south of the main deposit and we anticipate that this area could provide an extension to the open pit operation beyond 2014. In addition, recent design work has shown that we can access deeper high-grade sulphide mineralization to the north of the open pit in as little as two years by utilizing underground methods. This thick, high grade mineralization is open to the north and to depth,” Hamilton said, adding that he is confident that there would be able to maintain the production level at 30,000 tonnes per annum beyond 2012 by integrating an underground mine into Mowana.


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