PERTH (miningweekly.com) – An updated feasibility study (FS) over Stage 1 of the Kolongwe copper/cobalt project, in the Democratic Republic of Congo, has improved project economics, ASX-listed Nzuri Copper reported on Monday.
Incorporating revised cobalt pricing and point-of-delivery, the new FS increased the project’s estimated post-tax net present value (NPV) from $82-million, to $130-million, and the internal rate of return (IRR) from 55% to 76%.
Average yearly copper and cobalt in concentrate production has been lowered from 19 360 t of copper to 18 657 t of copper, and from 1 507 t of cobalt to 1 370 t of cobalt, while the life-of-mine has increased from seven years to eight years.
While the project’s capital expenditure remained unchanged at $53.12-million, C1 cash costs have decreased from $1.35/lb to $0.85/lb.
Nzuri noted on Monday that the scope of the Stage 1 operation remained openpit mine and on-site one-million-tonne-a-year dense media separation processing plant.
Company CEO and executive director, Mark Arnesen, noted that in conjunction with the updated FS, a recently completed Stage 2 preliminary economic analysis had captured the value potential of a larger solvent extraction and electrowinning (SX-EW) development.
“This has confirmed our view that there is huge upside in the project, which can be unlocked through future staged expansions funded from Stage 1 cash flows. The results provide a clear roadmap that will help guide the detailed front-end engineering and design of the project, which is about to commence.”
While a number of development options were investigated, Nzuri’s preferred option would require an additional capital investment of $270-million for the Stage 2 development, which would see the production of 145 000 t of payable copper and 14 000 t of payable cobalt, resulting in both the NPV and IRR increasing to $340-million and 91%, respectively.
Nzuri will pursue this option further, with additional engineering and mining studies planned to enable a further ore reserve update and a revised FS-level evaluation of the project economics to be generated.
“Our immediate focus over the next few months is to advance appropriate funding solutions and, with the support of our cornerstone shareholders, deliver Stage 1 as quickly as we can while keeping in mind the best way of pursuing SX-EW processing,” said Arnesen.
“At the same time, we are continuing to pursue aggressive exploration aimed at growing our resource inventory and mine life at numerous exciting near-mine and regional targets.”