GOMA, Democratic Republic of Congo (miningweekly.com) – Despite facing significant social, political and geographical challenges, emerging miner Alphamin Resources is on track to deliver on the first large commercial tin mine in the eastern Democratic Republic of Congo (DRC).
Against a backdrop of historical political upheaval, rent-seeking, an established heavy artisanal mining industry and a lack of infrastructure, the first production at Alphamin’s Bisie tin mine, in North Kivu, is expected in the first quarter of 2019, with the mine set to reach steady-state production by the end of 2019.
After spending years establishing peaceful cohabitation with communities and artisanal miners and gaining control of its resources, the mine has nearly 1 000 workers on site – 800 unskilled workers from the communities up to 30% of whom are former artisanal miners – working on the development of the mine.
With the start of the underground workings well under way, including the development of the decline, as well as the crusher already on site, the camps built, the construction workers’ accommodation nearing completion and the mining team settled, 2018 will mark a milestone year as the civil and earthworks and mining contractors are appointed, besides others.
In what CEO Boris Kamstra described as a starter project to prove what can be done in a volatile and difficult region, Alphamin Bisie Mining (ABM) is steadily chipping away towards the development of the 10 000 t/y underground mine with a 12-year life span that is expected to become the next significant tin producer and double the DRC’s tin exports.
“One wouldn’t embark on a project of this nature if the prize was not worth it,” he told Mining Weekly Online during a site visit to the mine this week.
Bisie is located 60 km from the town of Walikale and 32 km from the national route linking Walikale with Kisangani.
The total spend on the mine to date is $9.5-million, with a further $30-million to $40-million committed for long-lead items.
By the time the mine starts production, Alphamin will have injected more than $120-million into the operation.
Alphamin expects a cash cost of $8 837/t of tin produced and $10 359/t of tin sold after duties, royalties, levies and marketing fees.
The mine will achieve earnings before interest, taxes, depreciation and amortisation of about $110-million a year, on average, leaving a significant buffer for the company should infrastructure challenges demand an alternative approach to transporting the mined ore or in case necessity dictates a reduction in production.
However, Kamstra is optimistic of the future of tin, pointing out that Bisie is strategically positioned to become the next major producer in an environment where future global tin supply is uncertain, given the depleting resources of former tin majors in Malaysia and Peru, and the challenges of the deepening mines in China and Myanmar.
“The International Tin Research Institute has forecast that there is likely to be a global shortfall of tin starting in 2018. There are a limited number of active industrial scale tin mines outside of China and Indonesia,” he explained.
ABM started exploration in 2012, targeting 40 000 m of diamond core drilling mostly at the Mpama North deposit, with plans to continue exploration activities, particularly around Mpama South and other nearby exploration targets, where there remained potential to significantly lengthen the life-of-mine.
Initial drilling focused on both Mpama North and Mpama South prospects where significant tin mineralisation was identified over several hundred metres of strike.
“All indications show that we haven’t reached the bottom of our orebody,” said Alphamin COO Trevor Faber, noting expectations of opportunities for expansions to the mine.
Kamstra added that there was “a lot more around” yet to be uncovered.
However, he commented that Alphamin was building “more than just a mine”, indicating the “beacon of hope” the mine has become for the people of Walikale.
North Kivu Minister of Mines Professor Anselme Paluku Kitakya agreed, noting that the potential success of the mine could be an example of the potential to develop a formal mining industry in the country.
The emergence of a “real” conflict-free mining industry is what Alphamin represents in a country where the bulk of the mining had traditionally been informal.
Further, Alphamin’s operation demonstrates what the region’s conflict mineral legislation aims to achieve.
Kitakya, meeting with journalists in Goma post the mine site visit, conceded that the region still faced major challenges in terms of security, inadequate legal and regulatory frameworks, inadequate infrastructure and fraud; however, he noted the significant work being done to mitigate the challenges and establish an attractive investment destination.
In addition, a special government support committee, the Committee to Accompany ABM in Implementing its Mine at Bisie, or CAIMB, had been established to support the development of the mine.
The CAIMB, which includes representative from 27 government divisions and ministries, aimed to support ABM and inform the provincial authorities of potential impediments to the project.
Of particular focus for the committee are artisanal miners, employment and subcontractors, security, environmental issues and community development.
Further to this, the Minister focused on investigating and eliminating any external fraud involving ABM minerals to maintain the integrity of conflict-free supply chains.
Meanwhile, peaceful negotiations had led to the relocation of the bulk of the artisanal miners at Bisie, with many subsequently migrating into the gold sector, which is now seen as a more attractive prospect.
At its peak, the artisanal mining activity attracted some 15 000 informal miners to the site.
This has since decreased significantly to a few hundred currently.
Meanwhile, Alphamin is also building a dedicated airstrip, set to be completed by February 2018, and plans to level, and widen to 6 m where possible, the 36 km stretch of manmade gravel road from Alphamin’s base camp Logu Lodge to Bisie.
Plans are also under way for Vodacom to upgrade its current tower near the mine to a 15 m mast, supporting the establishment of telecommunications in the territory.
In addition, Alphamin plans to inject $4.5-million into fixing the main 200 km stretch of the national road between Goma and Walikale, where the roads have significantly deteriorated.
Further to this, Faber noted that three 1.2 MW generators will be installed at the site, providing 3.5 MW of installed power to the mine that currently uses less than 3 MW.
Currently, the mine uses 650 000 ℓ of diesel a month for the generators and mining fleet, besides others.
Eventually, another 3 MW of generator capacity will be installed as power use increases, followed by the potential, still-under-consideration, installation of a micro-hydropower plant between years eight and ten of the mine’s life.
In terms of further community contributions, Alphamin has committed 4% of its in-country spend to developing the 44 communities surrounding the mine, with the intention of completing at least one flagship project a year, explained ABM MD Richard Robinson.
About 16 000 households, comprising 80 000 of the one-million people in the region, will benefit from the community projects.
Recently, Alphamin completed the construction of the Luuka Primary School, near Logu, which has capacity for 300 pupils.
Currently, 200 children are enrolled, with about 80 secondary schoolers making use of the facilities in the afternoon, revealing the need for more educational facilities in the area.
Through the Lowa Alliance, well over 100 development projects are partially financed by Alphamin.
“Alphamin’s development will fundamentally transform the local economy, social conditions and underlying governance of the Walikale territory and North Kivu province,” Kamstra said.
The Bisie mine is expected to employ more than 700 people during construction and 450 permanent employees once operations start.
Alphamin was already the largest local employer in the region and adding value to the area through job creation, construction, connectivity and development of economic infrastructure, Kamstra said.