Mining Breaks

Global commodity producer and trader Glencore International has strengthened its links with Red River Resources, signing an offtake agreement to acquire all gold concentrate production from the Australian miner’s Hillgrove mine, 30km E of Armidale in NSW.
Glencore already is Red River’s copper offtake partner at its Thalanga base metals project, 65km SW of Charters Towers in Queensland.
“It’s great to have the support of Glencore for Hillgrove given our strong four-year working relationship to date,” MD Mel Palancian says.
Red River began gold production from the Bakers Creek stockpile material in Dec 2020 and trucked its first load of gold concentrate on June 18 while commissioning activities progress.

West Australian lithium producer Pilbara Minerals is anticipating record spodumene concentrate shipments from its 100%-owned Pilgangoora project for the June qtr (Q4FY21), boosted by strong production for the period and stock positions established at the end of the previous period.
Q4 spodumene shipments are expected to reach about 96,000dmt, up from 71,229t previously and ahead of its 75,000-90,000t guidance.
With the inclusion of a delayed shipment from the previous qtr, sales for the qtr are expected to be 109,000t.
Production is set to rise further in 2022 following approval to commence the staged restart in the Dec 2021 qtr of the Ngungaju operation acquired last year from Altura Lithium.

Lithium developer Prospect Resources remains on track to deliver technical-grade petalite product in June after completing pilot plant construction and commissioning on schedule and within budget at its 70%-owned Arcadia project in Zimbabwe.
The high-purity samples are to be used with spodumene samples from a partner laboratory to achieve final production qualification with customers.
Prospect is progressing discussions with strategic groups in Japan, China and Europe interested in spodumene offtake and assisting with project development.
MD Sam Hosack says the pilot plant will allow Prospect to substantially reduce metallurgical risk and increase confidence in technical study work and economics.

The global diamond market’s strong recovery from the 2020 depths of the COVID-19 pandemic have seen Lucapa and its partners in the Lulo alluvial mine in Angola achieve an average price of $US34,548/oz on the sale of seven exceptional diamonds.
The large, high-quality and fancy-coloured diamonds, weighing a total of 620ct, were sold via tender through Sodiam in Luanda for $21.4M - making it the mine’s largest single sale event.
The prices reflect the recovery in rough diamond prices due to returning consumer demand while rough supplies remain low.
MD Steven Wetherall says they also demonstrate the strong demand for unique, large and high-quality natural diamonds such as those from 40%-owned Lulo and its 70%-owned Mothae mine in Lesotho.
Lulo has cemented its position as the highest value global alluvial producer in the first half of 2021, achieving $38,8M in sales at $3,275/ct.

Despite substantial falls in revenue and profits for the June half-year, international consulting and engineering company John Wood Group says improving momentum in the last three months has boosted its confidence of a return to growth in the second half of FY2021.
The UK-based company expects H1FY2021 revenue of $US3.2B, 21% lower than the corresponding period due to COVID-19 impact. It says lower activity in projects was partly offset by robust consulting activity and relative resilience in operations.
Adjusted EBITDA is forecast $255-265M, 12% below the corresponding period on a like-for-like basis. Improved performance in all business units is expected to increase adjusted EBITDA margin to 8-8.3%.
Operating profit before exceptionals is expected at $85-95M.

Moroccan-focused potash development company Emmerson is on target for early construction work by end-2021 at its low-capex, high-margin Khemisset project, enabling it to take advantage of strong market fundamentals.
With all technical work completed, Emmerson says final environmental approval is imminent - subject to COVID restrictions. Geological, design and engineering work are complete and a field works tender process begun.
A FS for the sulphate of potash project now begun aims to diversify product offering and enhance margins.
CEO Graham Clarke says Emmerson continues positive discussions with strategic investors and due diligence for the wider project debt finance.
Khemisset has a JORC resource of 537Mt @ 9.24% K2O with significant exploration potential and accelerated development pathway.

Copper miner Atalaya has outlined potential to increase production and extend life by declaring a new independent reserve estimate of 702,000t contained copper for the Cerro Colorado openpit at its 100%-owned Proyecto Riotinto in SW Spain.
The 186Mt @ 0.38% proved and probable reserve implies a mine life over 12 years at its recently expanded mill nameplate capacity of 15Mtpa.
CEO Alberto Lavandeira says, having established Proyecto Riotinto as a long-life mine, Atalaya can work towards new targets able to expand production throughout the Riotinto district. The high-grade San Dionisio copper and polymetallic deposit on the W side of Cerro Colorado could provide future feedstock.
Atalaya will now prepare an NI 43 101 report incorporating Cerro Colorado and the wider Riotinto district.

Indonesia is considering a plan to restrict construction of smelters producing nickel pig iron or ferronickel to optimise use of its limited nickel ore reserves for higher-value products, according to a senior mining ministry official, Reuters reports.
Indonesia is currently the biggest producer of the 2 crude metals and a restriction on more smelters coming online could hit Chinese stainless steel producers, which are among biggest customers for Indonesia’s relatively cheaper materials.
Restricting construction of new smelters is deemed necessary because of limited reserves of saprolite nickel ore, according to senior Energy and Mineral Resources Ministry official Ridwan Djamaluddin. “Based on the input capacity of existing and under construction pyrometallurgical plants, assuming there is no further exploration, if constructions are not limited, this high grade nickel ore reserve will only last for less than 20 years,” he said.
Indonesia banned exports of unprocessed ore last year to promote development of a nickel smelting industry. SE Asia’s biggest economy has 16 nickel smelters running, mostly producing NPI and FeNi. In 5-years, the number is expected to increase to 29.

Arafura Resources has received firm commitments from Australian and overseas institutional investors for $A40M via a 2 tranches share placement, plus another $5M shares under a share purchase plan at the same price.
Funds raised are for front-end engineering and design activities at the company’s 100%-owned Nolans rare earths project in Australia’s Northern Territory, scheduled to begin mid 2021 after a feasibility study update confirmed robust financials.

BHP Group plans to almost double exploration spending for base metals within 5-years, Chief Technical Officer Laura Tyler said today after the company shifted its exploration HQ to Toronto, Canada, from Santiago, Chile, Reuters reports.
The world’s biggest listed miner is expected to log bumper profits in August on booming prices for iron ore, but the pipeline for new projects is thin. BHP’s board is expected to make a call on its Jansen potash project in Canada as the miner looks to raise its exposure to new economy minerals, including copper and nickel, seen as cornerstones of the world’s transition towards cleaner energy.
Global exploration spending for base metals will nearly double within 5-years from the current $US70M-$80M.
The miner has partnered with junior Midland Exploration to explore for nickel in the Nunavik region of N Quebec, Canada. It also has a J/V on copper concessions in Ecuador with Vancouver-based Luminex Resources and holds a 12.3% stake in Solgold, whose Cascabel-Alpala copper-gold project in Ecuador is expected to start production in 2025.

Western Australia-based Firefinch has launched a $A46.9M share placement primarily to become a 200,000oz gold producer from its 80%-owned Morila Gold Mine in Mali by 2024 and finalise completion of the J/V transaction with the world’s largest lithium producer, China’s Ganfeng, to develop the Goulamina lithium project, also in Mali.
The Morila gold mine has produced 7.5Moz of gold since 2000.
Firefinch acquired the mine in Nov 2020 aiming to increase production from the 4.5Mtpa mill from a current 40,000oz pa of tailings, to 70,000oz-90,000oz from mining small open pits, stocks and tailings from mid-2021. In 2022, Firefinch plans to increase output to 150,000oz-200,000oz by re-commencing mining from the main Morila pit.
The proposed Goulamina’s demerger is aimed at a separate ASX-listed.

Cambodia’s first modern large-scale gold mine has poured its first gold for Australian-based Emerald Resources, with its 100%-owned Okvau project in the country’s east delivering two bars totalling 8.6kg.
MD Morgan Hart says construction and the first gold pour remained on budget and schedule despite the logistical challenge of the global pandemic.
After initially processing oxide ore from crusher to the SAG mill and through the CIL tanks, stripping circuits and detox circuit, Emerald’s focus now shifts to commissioning the fine grind float circuit and adding higher-grade sulphide ore as it ramps up to full production.
Okvau is forecast to produce 100,000-110,000ozpa over 7-plus years from its reserve of 907,000oz (14.3Mt @ 1.98g/t).

The first gold pour is due in around a week from Capricorn Metals’ wholly owned Karlawinda openpit project in Western Australia’s Pilbara region after completing the $A165-175M development and its three-week commissioning program.
Continuous ore processing through the ball mill and crushing circuit in the last week with low grade ore, transitioning to ROM grade ore as it moves to steady state operations over the next week.
The Karlawinda project is expected to produce 105,000-120,000ozpa gold over a 12-year mine life from a reserve of 1.2Moz.

Australian base metals explorer Redbank Copper is confident it’s laid a solid foundation to advance its namesake copper project in the NT using modern exploration techniques after posting an inferred JORC-compliant resource of 88,600t contained copper (8.4Mt @ 1.1% Cu, 0.3% cut-off).
Exec director Michael Hannington says the update results from significant work to validate huge amounts of historical data to align it with JORC 2012 standards.
The resource figure is based on openpit estimates, excluding an earlier JORC 2004 underground resource.
Redbank’s current exploration aims to define a new resource base outside the known deposit, with positive early indications.

The first round of drilling by West Australian explorer TNT Mines at the historic Eureka gold mine in the Goldfields region 50km N of Kalgoorlie has delivered a new indicated and inferred JORC resource of 112,000oz (2.45Mt @ 1.4g/t), with the results of its recently completed follow-up drilling still to be included.
The resource calculated by CUBE Consulting represents an increase of 68,900oz on the 43,100oz it inherited when it purchased Eureka, along with the Warriedar gold project in WA’s Murchison region in a share sale agreement from privateer Warriedale Mining in Oct 2020.
TNT says the increase has been delivered at an exploration cost of $A21/oz.
CEO Matthew Boyes says the excellent result in a limited time highlights the quality of the Eureka orebody and greater tenement package. Eureka now has a solid base from which to grow.

Explorer Condor Gold has named US-based Hanlon Engineering & Associates to lead the development of a feasibility study-level design for a new processing plant to encompass the recently acquired new SAG mill at its 100%-owned La India gold project in Nicaragua.
Hanlon, a wholly owned subsidiary of Australian company GR Engineering Services, will be responsible for the engineering designs, capital and operating costings. Delivery is due within 12 weeks.
The plant will be designed to nominal 2,300tpd throughput, which would support initial gold production of 80,000-100,000ozpa, with built-in capacity in key areas for potential upgrades to 2,850tpd.

West Australian explorer Strickland Metals has labelled as “transformational” its $A10M cash or cash-plus-shares acquisition of the Millrose gold project adjacent to its Horse Well project, now under 100% control after it purchased Northern Star’s 37% stake for $1.75M last month, and the Yandal East project it agreed to purchase two weeks ago for $2M in cash and shares.
Three months after a significant board restructure, new CEO Andrew Bray says the deals complete Strickland’s plan to consolidate the underexplored NE flank of the Yandal Greenstone Belt and build its resource base to 603,000oz.
The company has also raised $8M in a placement and launched an entitlement offer seeking a further $4M, which will support a major systematic drilling program to commence early in the Sept qtr. Bray’s L11 Capital PL, the company’s major shareholder, will invest $1M in the placement.

The owners of Spain’s Minas de Aguas Teñidas (MATSA) company plan to launch the sale of the copper miner on Friday in a deal led by investment banks Bank of Montreal (BMO) and UBS that could fetch up to $US2B, Reuters reports.
Global commodities trader Trafigura and Abu Dhabi state investor Mubadala, which co-own MATSA and its 3 underground mines in S Spain, have set an end of the week deadline for initial offers, kicking off the formal sales process, according to sources.
The company was valued by 2 of the 4 bankers at between $1.5B-$2B. Trafigura, Mubadala, MATSA and UBS have declined to comment, and BMO was not available for comment. Other interested companies were flagged as Canada’s Lundin Mining and Hudbay Minerals, as well as Australian miner South32 and Canada’s First Quantum. MATSA produced more than 300,000t of copper concentrate in 2020, along with zinc and lead concentrate.

Glencore CEO Ivan Glasenberg says a supply gap is growing in the metals necessary for the world to replace fossil fuels with renewable energy, but he stopped short of predicting a so-called super cycle, Reuters reports.
Glasenberg said at the Qatar Economic Forum that copper supplies needed to increase by 1Mtpa until 2050 to meet an expected demand of 60Mtpa. The world currently consumes 30Mtpa of copper and “over the past 10-years, we’ve only added 500,000tpa. Do we have the projects? I don’t think so. I think it will be extremely difficult.”
He said the nickel and cobalt markets were facing similar supply deficits over the next few decades, with nickel supplies needing to grow by an extra 250,000tpa compared with an historic 100,000tpa.

Australian developer KIS has named mineral processing company Gekko Systems as preferred engineer for final design and turnkey construction of the processing plant for its 100% owned Dolphin tungsten project at King Island in Tasmania.
The companies are finalising the battery limits and negotiating terms to enable the contract to be awarded as soon as funding is completed.
Gekko has been involved in the project for 3 years, including the design of the processing facilities.
The announcement coincides with the approval by Tasmania’s Environmental Protection Authority of the mine closure, decommissioning and rehabilitation management plan.