After an 18-month struggle to reach full production, the Moma titanium minerals mine on the coast of northern Mozambique, which contains one of the largest deposits of titanium-bearing mineral sands in the world, is back on track. It should reach its full production targets by the third quarter of 2009.
The US$410 million Moma operation is wholly-owned by Kenmare Resources whose managing director Michael Carvill tells Mining Review Africa that various problems encountered by the project contractors had delayed the project. It was originally scheduled to ramp up to full production of 800,000 tonnes per annum (tpa) of ilmenite, 18,000 tpa of rutile and 30,000 tpa of zircon by the end of 2007.
“There were difficulties with the refractory linings for the product roaster, which had to be re-done on two occasions,” he explains. Following this, the roaster handover only took place in about April 2009.
Kenmare was initially concerned that, without this product enhancement, sales might be a problem, but the company did not suffer terribly in the market because of the failure of the contractor to deliver the roaster. “We have been producing, exporting and selling ilmenite and zircon products,” Carvill says.
“The other problem is that once various other parts of the plant had been handed over, many of them did not operate at the level outlined in the contract,” he adds. “As a consequence, the contractor, in terms of the contract, had to perform a set of performance tests. These were conducted last November, and they all failed.
The contractor is now cooperating with us in a succession of remedial projects aimed at righting deficiencies in the plant and equipment that has been delivered,” Carvill says. In planning and implementing the programme of remedial actions being undertaken by the contractor, Kenmare has come up with a new production profile.
“In 2008 we produced 271,000 tonnes of ilmenite, 7,000 tonnes of zircon and no rutile. This year we expect to produce 560,000 tonnes of ilmenite, with a similar percentage increase in Zircon. Rutile production will also start.
“We believe we have identified all the issues that held production back, and are well through the process of fixing them,” Carvill says. “We are thus very hopeful that by the third quarter of this year we will be either at or very close to full production.”
The total reserve and resource under licence to Kenmare is 181 million tonnes of ilmenite, with 12.6 million tonnes of zircon and 4.1 million tonnes of rutile. “While an increase in this resource is certainly possible, we have not devoted any time to enhancing that number,” Carvill points out. “We believe that it is already a very large number, compared with our ability to mine it at the moment. We don’t see any need to demonstrate by drilling that we can push this up. It’s beyond commercial advantage at this stage.”
The proven and probable reserves within the dredge path design for the project are 472 million tonnes of ore grading 4.4% total heavy minerals, which is equivalent to 17 million tonnes of ilmenite. Total reserves for the Moma project amount to 639 million tonnes of ore containing 21 million tonnes of ilmenite and total resources are six billion tonnes of ore containing 160 million tonnes of ilmenite.
“The original capital expenditure calculated for the Moma project was US$330 million, but that has risen to about US$410 million,” Carvill confirms. “This was as a result of the contractor’s problems, which increased capital through the late ramp-up, although in the end the contractor will pay for the remedial activities,” he adds.
The Moma project aims to mine 22 million tpa of titanium-bearing sand, using two dredges as the primary mining devices floating on an artificial pond. Mined material is pumped as a sand-and-water slurry to a floating concentrator plant. In this plant a heavy mineral concentrate is separated from the sand using spiral separators. Sand tailings are ejected at the rear of the concentrator, and thus build up the rear of the pond. The pond is mined at the front and in-filled at the rear, so it moves slowly through the orebody on a designed mine path.
The heavy mineral concentrate is pumped to a separator plant located near the deposit. In this plant it is separated into distinct final products, and two of these products are roasted to improve their characteristics. The final products are stored in a shed with a capacity of 140,000 tonnes. Products are exported by transportation along a conveyor from the storage shed to the coast along a jetty, and loaded into a barge.
This barge transports product to bulk carriers moored at an offshore mooring point. The barge then unloads into the bulk carrier using the barge’s own materials handling system. The design loading rate is 1,200 tonnes an hour.
Kenmare has secured off-take sales contracts covering 100% of current production. “At the moment everything that we produce is pre-sold under contract,” Carvill says. “But we must bear in mind that we are living in a very rapidly changing world – while contracts are good, they are not infallible.”
The company does have expansion plans at Moma, and has no intent to joint venture these. “We believe that, after quite a fair measure of difficulties, we have achieved agreement with the contractor that the only way out of the problems is to fix them, and that is happening,” Carvill says.
“Once we reach that point, and always assuming that the world makes some movement towards fixing itself, we will move as smartly as possible into the first expansion. Put it this way, as soon as we have adapted to full production, we will immediately focus on the expansion. This first expansion will be in the short term, and will involve greater utilisation of the existing assets, of which many have excess capacity. This aspect of expansion will not be very expensive.
“A lot of the spending on building this mine involved things like: an overhead transmission cable, an airstrip, a mining village, water reticulation, the jetty and export facilities. We can make greater use of all of these without having to replicate,” he explains.
“We are thinking in terms of about a 40% expansion to between 1.1 and 1.2 million tpa, and the market should be able to sustain that level of supply,” he says.
As far as other projects are concerned, Kenmare’s absolute focus is currently on Moma. “We do have some other exploration activity underway,” Carvill says, “and that is also based in Mozambique.”
Commenting on the impact of the global financial crisis, he says the mineral sands industry has certainly felt the effect. “There have been some deferrals of shipments to customers. As far as prices are concerned, the price of ilmenite never accelerated and reached the stratospheric levels other commodities achieved. Consequently its decrease has been small compared to the others – it’s a lower volatility end product,” he says.
“A continued downswing would make things much harder, but I believe that this industry is in a reasonably good position to survive and produce reasonable returns.”