Orion Minerals has secured final permits for new South African copper-zinc mine, prepares for early site works and restarts exciting new phase of near-mine and regional exploration.
Prieska Copper-Zinc Project, Northern Cape Province officially “shovel-ready” and one of the few advanced, fully-permitted base metal projects worldwide:
- Mining Rights now in place for the entire mining plan presented in the updated Bankable Feasibility Study.
- Important near-mine exploration upside also covered by the Mining Rights.
- 20-year Water Use Licence granted, marking another key permitting milestone.
Prieska Project development advancing on several fronts:
- Tenders received from prospective bidders for the EPCM contract; adjudication in progress.
- Preferred EPCM contractor to be selected by year-end.
- Work underway to prepare for undertaking Early Works, in preparation for the project being fully-funded.
“The September Quarter saw Orion take further major steps towards developing a world-class, long-life base metals operation at our flagship Prieska Copper-Zinc Project, which we believe is ideally placed both to be a flag-bearer for junior mining in South Africa and to help drive the post-COVID economic recovery of the Northern Cape Province,” said Orion’s Managing Director and CEO, Errol Smart.
“As a result of the milestones achieved, Prieska is now one of the few fully-permitted, bankable and shovel-ready base metal assets anywhere in the world. And we are now ready to move from being shovel-ready to shovelling, with an adjudication process underway for our preferred EPCM contractor and preparations underway for early site works.
“We also progressed discussions with a wide range of potential strategic partners, customers and project financiers during the Quarter. Prieska is a unique asset in the global base metals context and accordingly, it is attracting a considerable amount of interest from across the spectrum of the mining and mine finance industry, both in South Africa and beyond.
“It’s also important to remember that the metals we will mine at Prieska will form a key pillar in the development of a more sustainable, green economy. In this regard, our development strategy received further impetus during the Quarter from the significant tailwind now being seen in the price for copper and other ‘future-facing’ metals as the world increasingly focuses on the importance of securing new supplies of these metals over the next decade.
The Prieska Project continues to be the focus of the Company’s activities and is now in the financing and pre-development stage following the completion of an updated Bankable Feasibility Study (BFS) in the June 2020 Quarter (refer ASX release 26 May 2020).
Post-BFS activities undertaken during the Quarter included continuing with the mine-to-market enterprise optimisation investigations being undertaken in collaboration with Whittle Consulting, advancing licencing processes and continuing with project execution planning activities.
Following the positive outcomes of the updated BFS, Orion is targeting a Final Investment Decision for the Prieska Project as soon as financing negotiations have been concluded. Orion intends to fund the development of the Prieska Project through a combination of debt and equity. The Company is progressing discussions with both potential debt and equity providers and potential strategic partners.
The Company intends to use an engineering, procurement, and construction management (EPCM) contracting arrangement to manage the construction phase of the PCZM, with oversight from an Orion Owner’s Team.
During the Quarter, the EPCM tender enquiry was released into the market and following Quarter end, six bids were received. The adjudication process is underway and a short-list of three contractors will be selected, with a preferred contractor to be determined by year-end.
PROCESS PLANT OPERATIONS
Discussions are continuing with Minerals Operations Executive (Pty) Ltd (Minopex), which is being considered to be contracted to operate the ore processing plant. Negotiations are expected to conclude in an Operating Agreement during CY2021.
UNDERGROUND MINING CONTRACT
Orion is preparing to recommence with investigations into the potential use of contractors for underground mining. Discussions with Byrnecut Offshore, with whom a collaboration agreement had been signed, were halted during the June 2020 quarter to allow completion of the feasibility study.
Internal enquiries are in progress regarding the level and timing of automation for the mining fleet, which is expected to have a bearing on the discussions with potential contractors. With the advice of external experts, a decision on an automation strategy is expected by year-end.
On 13 July 2020, the Company announced that it had entered into an agreement where Orion will acquire the remaining minority interests in the Jacomynspan Nickel-Copper-PGE Project (South Africa) (Jacomynspan Project) held by two companies, Namaqua Nickel Mining (Pty) Ltd (Namaqua) and Disawell (Pty) Ltd (Disawell) (Agreement).