Sandfire Resources has confirmed the potential to rapidly expand its Motheo Copper Mine in Botswana from 3.2 Mtpa to 5.2 Mtpa following the completion of a maiden Ore Reserve estimate for the satellite A4 Deposit and Pre-Feasibility Study for the Expansion Case.
Maiden Probable Ore Reserve completed for the A4 Deposit, located 8km west of the Motheo Copper Mine in Botswana:
- 9.7 Mt at 1.2% Cu and 18g/t Ag for 114 kt of contained copper metal and 5.7Moz of contained silver.
- 85% of the contained copper in the updated A4 Mineral Resource announced on 21 July 2021 now classified as Ore Reserves.
- Ore Reserve confirms A4 as a high-grade source of additional ore feed for the Motheo Copper Mine, underpinning an expanded long-life 5.2 Mtpa Production Hub.
- Sandfire will now move directly to a Definitive Feasibility Study (DFS) for the 5.2 Mtpa Motheo Expansion, with the DFS expected to be completed in Q3 of FY2022.
Pre-Feasibility Study (PFS) completed to inform the A4 Ore Reserve has indicated outstanding project economics from an expanded 5.2 Mtpa mining operation compared to the initial 3.2 Mtpa base case development scenario:
- 116% increase in pre-tax NPV7% to US$672 million ($937 million) and IRR of 36%,
- Mine life of 10.5 years, peak production of 60ktpa copper in concentrate, strip ratio of 6.5 waste to ore, 15% decrease in LOM all-in sustaining costs to US$1.56/lb.
- Opportunities identified to further enhance the economic and technical outcomes of the A4 PFS through integrated mine scheduling and pit optimisation, with these enhancements to be incorporated into the DFS for the 5.2Mtpa Expansion Case.
- Total pre-production development capital increased to US$366 million ($504 million), incorporating development costs for the A4 Open Pit plus an updated cost forecast for the Motheo plant to account for increased steel costs, foreign exchange movements and COVID related disruptions.
- Outstanding potential for further Resource and Reserve growth, with recent step-out drilling confirming high-grade mineralisation ~1.2km south-west of the A4 Mineral Resource envelope and drilling continuing across an exceptional target pipeline within Sandfire’s extensive landholding in the Kalahari Copper Belt.