Sydney, Australia — MININGREVIEW.COM — 11 September 2008 – AIM Resources Limited – an Australian and London-listed minerals company focused on the acquisition and development of major mining ventures in Africa – has commenced a care and maintenance programme at its Perkoa zinc project in Burkina Faso.
The company announced in mid-July that it had decided to suspend development activities on the Perkoa project, based on current economic factors, including the depressed global zinc price.
Mining contractor Byrnecut Mining Pty Limited, EPCM contractor DRA Mineral Projects and earthmoving contractor Banlaw Africa Ltd have all demobilised. Civil work to complete footings and foundations for the process plant is continuing, and the civil contractor De Simone Limited will only demobilise when this work is complete.
A media release issued here confirmed that the care and maintenance programme had now been implemented, and was estimated to cost approximately US$30 000 (R225 000) per month. This would cover labour and materials necessary to ensure the safety and security of the assets, and to conduct routine maintenance to ensure that machinery and equipment were kept in a satisfactory condition for future use.
Given that the Project is currently on care and maintenance, it has been decided that additional drilling will be deferred until zinc prices improve and project funding is secured.
The AIM release estimated that recommencement of construction at the Perkoa project would require a financing package that mitigated price volatility and a stronger zinc price outlook. An analysis of zinc price sensitivities had identified that the project economics required an average zinc price of US$2 100 over the life of the mine to provide a minimum return of 10% (in real terms).
It said the project was approximately 50% complete, and work was underway to update the capital budget estimate to complete the project, incorporating re-mobilisation costs and projected cost escalations for future expenditure. Work was also continuing to find suitable investor(s).