Modern Mining March 2019

MINING News

The ore from the Zone 5 Starter Project will be treated in the Boseto concentrator, seen here (photo: Arthur Tassell).

Cupric Canyon secures financing for Khoemacau

Khoemacau Copper Mines (Khoemacau) and Cupr ic Canyon Capital have announced major progress towards the construction of the Khoemacau copper/sil- ver project in Botswana with the signing of a ‘Project Funding Package’ to commence development of the project. Khoemacau is owned by Cupric Canyon Capital. The highlights include US$565 million of funding including a US$275 million senior debt facility from Red Kite Mine Finance (RKMF), a US$265 million silver stream from Royal Gold AG (RG AG), a wholly owned subsidiary of Royal Gold, Inc, and a US$25million subordinated debt facility from RG AG. The funding will be used for construc- tion of the Khoemacau Starter Project processing ore from a 91 Mt resource at a head grade of 2,02 % copper and 21,4 g/t silver. The direct construction cost of the Starter Project is US$397 million over a two-year construction timeline. Khoemacau and Cupric (together referred to here as the ‘company’) have been developing the Khoemacau project, a 4 040 km 2 land package in north-west Botswana, over the past six years. One of the deposits within the project, Zone 5, was initially discovered in 2012 and has since become the flagship deposit since it

was acquired in 2013. Since then, the com- pany has drilled 285 000 m, completed permitting and land access agreements, secured the required power and water, and undertaken advanced engineering, procurement and mobilisation such that it is ready for full construction release of the Starter Project, pending closing of the proj- ect funding package. In 2015, Khoemacau and Cupric acquired the Boseto assets (a previously operated copper project adjacent to Zone 5) following the insolvency of that company’s parent. This acquisition offered access to the 3,0 Mt/a Boseto processing facility, located 35 km from Zone 5, along with extensive infrastructure, and vari- ous mineral resources and licences. Since acquisition, the Boseto assets have been incorporated into the Starter Project devel- opment plan. The Starter Project will see the fully mechanised underground mining of sul- phide ores at Zone 5 at a rate of 3,6 Mt/a using the upgraded Boseto processing facility for crushing, milling, flotation and production of a high-grade copper/silver concentrate. Three separate but adjacent under- ground mines will be developed at Zone 5, each producing 1,2 Mt/a on average for the

first five years. Each of the mines will have its own independent ramp access and operate over a strike length of approxi- mately 1 000 m, extracting ore using a conventional sub-level open stoping min- ing method. The mined ore will be trucked to the Boseto processing facility, which will be refurbished and enhanced to process 3,6 Mt/a. Processing will be conventional sulphide flotation via three-stage crush- ing, ball milling and flotation, which will produce a concentrate for shipment to African and international smelters. Power will be sourced from the Botswana Power Corporation grid via a 56 km overhead transmission line connec- tion. Existing diesel generation capacity remaining from the previous Boseto opera- tions will be used as backup power. Water will be supplied from three borefields along with dewatering boreholes from the mines at Zone 5. The Starter Project is expected to pro- duce a high quality copper concentrate with an average grade of approximately 40 % copper and high-grade silver. This results in average production of 62 000 tonnes of copper and 1,9 Moz of silver per annum over a 21-year mine life. The aver- age life-of-mine C1 cash cost, net of silver

8  MODERN MINING  March 2019