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Junior highlights sector’s prospects of rejuvenating SA mining

BUSHVELD COMPLEX EXPLORATION WORK Lerama Resources is currently involved in two exploration projects in the Bushveld Complex, in Limpopo, which have the potential to become small polymetallic base-precious metal producers

ALBERT SILVER MINE PROJECT Lerama Resources recently completed a drilling programme at the site which confirmed the presence of mineralisation over a 2 km stretch, with grades of over 2% of copper, 150 g/t of silver and 500 parts per million of uranium

22nd May 2015

By: Ilan Solomons

Creamer Media Staff Writer

  

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Black economic-empowerment junior mining and exploration company Lerama Resources believes that the small junior mining sector, if sufficiently supported financially, could turn around the fortunes of the ailing South African mining industry.

Lerama is currently involved in two exploration projects in the Bushveld Complex, in Limpopo, which have the potential to become small polymetallic base/precious metal producers joining other profitable small mining operations globally.

Through these projects, Lerama hopes to contribute to mineral production, growth and employment opportunities in South Africa.

The Boschhoek copper project, 20 km north-east of the town of Marble Hall, at the Limpopo-Mpumalanga provincial boundary, is run by Lerama subsidiary Meruka Mining and has the potential to become a low-grade openpit mine.

Drilling on only one portion of an otherwise much larger footprint has defined an inferred resource at 0.35% copper with a cutoff grade of five-million tons of 0.52% copper for 26 000 t of contained copper metal.

Lerama notes that this includes 1.3-million tons of potential heap-leachable oxidised material (near the surface) for 6 600 t of copper metal, according to mining consultancy The MSA Group’s November 2014 competent person’s report resource statement.

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

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

“Analysis of copper production trends by global mining and research company SNL Metals & 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 preproduction copper projects of 0.42% copper, while projects currently in the feasibility and development stages show a global average copper grade of 0.46% of copper,” he states.

Another Lerama subsidiary, Roodepoortjie Resources, runs the Albert Silver mine project, situated 50 km north of Bronkhorstspruit, in Gauteng.

Lerama says that the Albert silver mine is a small deposit that was known to have been in operation sometime from 1886 to 1902 and which, in more recent times, was explored as a polymetallic proposition by global miner Anglo American.

The company states that it recently completed a drilling programme at the site, which confirmed the presence of mineralisation over a 2 km stretch, with grades of over 2% copper, 150 g/t silver and 500 parts per million uranium in portions of the Albert mine site, showing potential for a small underground operation.

“Although small-scale miners are not commonplace 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.

Benchmarking Lerama’s assets against similar deposits illustrates the point.

Examples of such mineral producers include the Osborne mine, in Queensland, Australia, and the Fraser mine, 15 km west of Palmerston, 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-million tons.

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

A report compiled mid-2014 revealed that the mine had reserves of 120 000 oz at a grade of 2 g/t to 2.2 g/t gold and produced 70 000 t/m.

However, Lerama notes that the Fraser mine is expected to be mined out by the end of this year.

“The successful operation of the Fraser mine in an ecologically sensitive and scenic area of the South Island of New Zealand illustrates the fact that small mining operations with life spans of five to ten years can be undertaken profitably,” Robb enthuses.

Further, he believes the Albert mine, with its similar footprint and multicommodity profile, could, with the necessary financial support, be reopened after its over 120 years of dormancy and operated along similar lines to the Fraser mine.

Edited by Martin Zhuwakinyu
Creamer Media Senior Deputy Editor

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