Colin Steyn, president and chief executive officer of LionOre, is expected to aid the mining boom in the northern parts of the country today (Sunday) as his company goes on a ground breaking ceremony of the multi-billion refinery system, Activox at Tati Nickel’s Phoenix mine.
The refinery system, which is the first of its kind in the world, is designed to enhance the recovery of metals and will increase the mine production from 14, 000 tonnes per annum to 22, 000 ton per annum over the mine’s life span of 11 years.
The move comes right on the heels of the company’s announcement last week that it had named Rand Merchant Bank of South Africa as its sole underwriter for a none-recourse nine and half years US$ 250 million towards the refinery and DMS projects in Botswana while rest will be provided by the company.
“They have indicated that they will provide the rest of the funding from their cash reserves and cash which will be generated during the course of production,” an analyst at Capital Securities, Leutlwetse Tumelo, said, adding that, in total, the company is going to invest P 4 billion on the project.
The system, of which LionOre has patent protection, uses chemical solution to extract metals from finely ground ore at low temperature and moderate pressure. The project will be completed in 2009 and will treat ore from LionOre operations, including Nkomati in South Africa.
Further, the company has not ruled-out the possibility of treating ore from other regional mining houses that would like to enhance the metal recovery.
The coming in of Activox is expected to see the staff compliment at the mine rising to 3 000 which will have a positive impact in the economy of Francistown and the surrounding areas.
Further, Steyn is expected to lay a clear plan on the opening of the Selkirk mine, which was initially estimated to open some time next year.
Selkirk is roughly 10 kilometers from Phenix mine and mid last year the company said it was “encouraged by (its) large resource” which will substantially enhance the future and production profile and life-span of Tati Nickel mine.
“We are enormously encouraged by the potential of this large resource at Selkirk to substantially enhance the future production profile and longevity of operations at Tati Nickel,” said Steyn. “This will undoubtedly contribute positively to the overall project economics of the proposed Activox┬« and DMS (Dense Media Separation) projects at Tati Nickel. Our priority now is to convert this resource into a reserve and we remain extremely confident of extending this new resource even further.”
The drilling has confirmed the continuity of a thick package of gabbro hosted disseminated sulphides around and down-plunge of the underground mine.
The development gives the potential for both open pit and underground mining activities at the site.
Meanwhile, Botswana Confederation of Commerce and Industry (BOCCIM) has applauded the move saying that it would impact positively on both the national and the local economy of Francistown.
“The growth in the mining sector will have positive effect both nationally and locally. It has a multiplying effect,” Iqbal Ibrahim, the outgoing president of BOCCIM, said last week.
“As for the business community, we are expecting to see additional income and for property there will be property price spike,” he said.
He said the property prices would be instigated by the influx of foreigners and the setting up of new contractors and suppliers to the mine.