South Africa – Black-controlled junior mining exploration company Lerama Resources believes that the small junior mining sector, if sufficiently financially supported, could turn the fortunes of the ailing South African mining industry.

Lerama Resources, who is currently involved in two exploration projects in the Bushveld Complex in South Africa, hopes to use these projects as a means to contribute to mineral production, growth and employment opportunities in South Africa.

Its projects have the potential of becoming small polymetallic base-precious metal producers joining other profitable small mining operations globally.

The Boschhoek copper project north east of Marble Hall, run by Lerama Resources’ subsidiary Meruka Mining, has the potential to become a low-grade open pit mine.  Drilling on only one portion of an otherwise much larger footprint, has defined an inferred resource at a 0.35% copper cut-off grade of 5 Mt of 0.52% copper for 26 000 t of contained copper metal. This includes 1.3 Mt of potential heap-leachable oxidised material (near the surface), for 6 600 t of copper metal.

Although the occurrence of base metals at this location has been known for several decades, the Boschhoek prospect has never been mined.

Lerama Resources technical director Professor Laurence Robb says the evaluation of low-grade copper deposits is a global trend.

Lower global ore grade trend

“Analysis of copper production trends undertaken by SNL Metals and Mining in 2014 shows that average mine head grades have trended lower since 2003 as the global resource inventory declines. Forecasts for the period to 2017 predict an average grade for pre-production copper projects of 0.42% copper, while projects currently in feasibility and development stages show a global average copper grade of 0.46% copper,” says Robb.

Another Lerama Resources subsidiary, Roodepoortjie Resources, runs the Albert silver mine (ASM) project situated 50 km north of Bronkhorstspruit.  ASM is a small deposit that was known to have operated in the pre-Boer War times and which in more recent times was explored as a polymetallic (copper-silver- uranium) proposition by mining major Anglo American.

A recently completed drilling programme by Lerama has confirmed the presence of mineralisation over a 2km stretch, with grades of over 2% copper, 150g/t silver and 500 ppm uranium in portions of the Albert lode, showing potential for a small underground operation.

“Although small-scale miners are not common-place in South Africa, many small base and precious metal mines operate profitably in other jurisdictions such as Australia, Canada, Zimbabwe and New Zealand,” says Robb.

Local junior miners take heed from successful international projects

Benchmarking Lerama’s assets with similar deposits illustrates the point. Examples of such mineral producers include the Osborne mine in Queensland, Australia and Fraser Mine in New Zealand. The Osborne mine started production in 1995 and in 2005 it produced 39 475 t of copper and 43 000 oz of gold off a resource base of 5.9 Mt.

The Fraser gold mine in New Zealand is a small underground gold operation with a record of historical production that recommenced operations in 2008.

A report compiled mid-last year revealed that the mine had reserves of 120 000 oz. at a grade of 2, 0-2.2g/t gold and produced 70 000 tpm. It is expected to be mined out by the end of this year.

“The successful operation of the Fraser gold mine in an ecologically sensitive and scenic area of the South Island of New Zealand illustrates the fact that small mining operations with lifespans of 5-10 years can be undertaken profitably,” says Robb.

He also believes ASM, with its similar footprint and multi-commodity profile could, with the necessary financial support, be re-opened after its 120 years of dormancy and operated along similar lines as the Fraser mine.

Set up for success

“The development of ASM would bring infrastructure and employment to an area that, with the exception of sporadic farming, is currently devoid of economic activity. The small size and underground operation of ASM ore body would also mean minimal impact on the local environment and relatively low rehabilitation costs.”

The ASM is currently in its second phase of drilling, while the Boschhoek project is expected to start with its third phase of drilling soon.

Lerama also holds prospecting rights over other polymetallic mineral deposits in the region. The company continues to evaluate its projects in the Bushveld Complex with the aim of proving the existence of small, economically viable, environmentally compliant, mines that will contribute to South Africa’s resource inventory, as well as provide the much needed development and employment opportunities to these economically depressed areas.

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