Name of the Project
Mutamba mineral sands project.

Location
The project is located in the Inhambane province of Mozambique.

Client
The project is being developed by Savannah Resources and Rio Tinto.

Savannah has the right to earn a stake of up to 51% in the project, subject to key milestones being met.

Delivery of the scoping study increases Savannah’s interest in the project to 20%, and to 35% on the delivery of a prefeasibility study.

Project Description
A scoping study on the project has concluded that there is potential for a financially robust, long-life mineral sands project that is expected to provide excellent life-of-mine financial returns with relatively modest capital requirements. The project combines Savannah’s Jangamo project with Rio Tinto’s adjacent Mutamba project, which includes the Jangamo, Dongane and Ravene deposits, as well as the Chilubane deposit, which is located 180 km south-west of the Mutamba project.

Mutamba has an initial mine life of 30 years, based on a resource of 451-million tonnes grading 6% total heavy minerals and on a conceptual mine plan using 33% of the indicated resource and 67% of the inferred resource. Average yearly production, following ramp-up to a 15-million-tonne-a-year mining rate, has been estimated at 456 000 t of roasted ilmenite and 118 000 t of nonmagnetic concentrate (rutile and zircon).

Dozer trap mining methods have been selected for the project. Mined ore will be slurried and pumped to the nearby primary concentrator plant (PCP). The PCP has been sized for a nominal feed rate of 2 000 t/h to produce 800 000 t/y of heavy mineral concentrate (HMC), with a heavy mineral grade of more than 90%.

The PCP tailings will be pumped directly back into the mine void. The HMC will be trucked to the mineral separation plant (MSP), where it will be fed into the mineral separation circuit for processing to produce a magnetic roasted ilmenite product and a zircon-rich nonmagnetic concentrate. 

The MSP has been sized to process HMC at 105 t/h to produce about 70 t/h of roasted ilmenite and 15 t/h of nonmagnetic concentrate. Products will be trucked to the export facility and be stored in a shed adjacent to the barge loading facility before being exported.

Jobs to Be Created
The project will have an expected final workforce complement of 332 people, with more than 1 000 indirect jobs expected to be created. The consortium is targeting 95% local participation once operations become established.

Net Present Value/Internal Rate of Return
Using the Management Case One, the project has a pretax net present value, at a 10% discount rate, of $245-million and an internal rate of return of 23%, with a payback of four years.

Value
Preproduction capital expenditure has been estimated at $152-million, plus contingency of $7-million.

Duration
Production is targeted for 2020.

Latest Developments
Savannah Resources has submitted three applications to Mozambique’s Ministry of Mineral Resources and Energy for mining leases for the Mutamba heavy mineral sands project. This is the final formal step in the process of securing long-term mining leases over globally significant deposits of heavy mineral sands.

The three applications, which cover 417.32 km², comprise the Jangamo, Dongane/ Ravene and Chilubane deposits.

Mining leases are generally awarded for a 25-year term and can be renewed.

The Ministry has six months from the date of submission to respond to the applications.

The pilot processing plant, commissioned in November 2017 will be used to produce concentrate as part of the prefeasibility study, which is under way.

Key Contracts and Suppliers
AML (turnkey reassembly and commissioning of the pilot plant, including site survey; installation of a site security fence with an access lockable gate and security post; bulk earthworks; preparation of the old railway line to be used as the construction access road; and civil works, structural reassembly and processing equipment assembly).
TZMI (Phase 1 PFS).

On Budget and on Time?
Too early to state.

Contact Details for Project Information
Savannah Resources, David Archer, tel +44 20 7117 2489.