Name of the Project
Prieska copper/zinc project.

Location
The project is located in the Northern Cape, in South Africa.

Project Owner/s
Orion Minerals.

Project Description
An updated bankable feasibility study (BFS) has confirmed the potential of the Prieska project to underpin a significant near-term, low-cost, copper/zinc development project with exceptional opportunities for future growth.

The project has total mineral resources of 30.49-million grading 1.2% copper and 3.7% zinc.

The updated BFS on the foundation phase of the project proposes the development of a new 2.4-million-tonne-a-year copper/zinc mining operation at the brownfield project.

Underground and surface mining methods are planned to be used in conjunction with conventional froth-flotation concentration to produce differentiated copper and zinc concentrates for export.

Peak production is estimated at 23 000 t/y of copper and 88 000 t/y of zinc.

The life-of-mine has been extended by two years from 9.7 years to 11.5 years.

Material changes in the updated BFS, compared with the 2019 BFS plan, include:

• reducing the mine dewatering timeline and supplementing the treatment of that water,
• incorporating additional mineral resources into the mining plan that will increase the mine life by two years,
• a more conservative timeline to ramp up to steady-state production,
• prioritising early mining of the high-grade zones in the mining sequencing,
• the adoption of semiautogenous grinding mills in the processing flowsheet,
• an owner-miner operating philosophy for underground mining,
• using an experienced contractor to operate the processing plan, and
• a change in the key operational infrastructure being supplied by third-party financing and in the supply of select key operational infrastructure.

The mining methods for the project remain unchanged, compared with those stated in the 2019 BFS. Tunnel development remaining from the previous mining operations allows for early access to underground production mining areas. A combination of longhole open stoping with fill and drift-and-fill mining methods, supported with paste backfill, is envisioned.

Potential Job Creation
Not stated.

Net Present Value/Internal Rate of Return
The project has a net present value, at an 8% discount rate, of A$779-million, compared with A$574-million in the 2019 BFS, and an internal rate of return of 39%, compared with 38% in the 2019 BFS. Payback from first production is estimated at 2.4 years, a decrease of five months.

Capital Expenditure
Total startup capital, including contingency, has decreased from A$400-million in the 2019 BFS to A$373-million in the updated BFS.

Peak funding requirements have increased from A$378-million in the 2019 BFS to A$413-million.

Planned Start/End Date
Orion Minerals is targeting a production startup in 2024, market conditions permitting.

Latest Developments
Base metals developer Orion Minerals has raised A$6.2-million in a strongly supported share placement to advance its Prieska copper/zinc project.

The company announced a two tranche share placement to sophisticated and professional investors on August 7, comprising 365-million shares at 1.7c each.

The first tranche will comprise 346-million shares and will be issued under the company’s existing placement capacity to raise an initial A$5.9-million. The second tranche of 19-million shares, which will be issued to Tembo Capital Mining Fund and its affiliated entities, will raise the remaining A$300 000, subject to shareholder approval.

In addition to the placement, Tembo Capital has also confirmed its continued support of Orion by subscribing A$2.1-million worth of shares, at an issue price of 1.7c a share, subject to shareholder and Foreign Investment Review Board approval.

Orion agreed to a A$1-million unsecured convertible loan facility with Tembo Capital in May this year, which would be automatically offset against the amount to be paid by Tembo Capital for shares in Orion under any capital raising undertaken by the company before the end of October this year.

As Tembo Capital’s subscription exceeds the outstanding amount for the convertible loan facility, the facility will be considered repaid in full.

“This raising puts us in a strong position moving into the back-end of this year as we progress funding discussions and move to the final stage of the Macquarie-led partnering process. We are confident that positive outcomes on any of these fronts will see this world-class asset begin to move rapidly towards a final investment decision,” Orion chairperson Denis Waddell has said.

Orion has received a key water licence for the Prieska project, removing the last regulatory hurdle to allow for project construction. 

Key Contracts and Suppliers
Companies involved in the BFS include A&B Global Mining; ABS Africa; BPDT & Co; Bluhm Burton Engineering & Ventilation Consultants; Beulah Africa; Cart Investments; DRA Projects South Africa; Earth Science Solutions; Endeavour Financial Limited; Falcon and Hume Attorneys Inc; Fraser McGill Mining & Minerals Advisory; Knight Piésold; METC Engineering; Gariep Mining and Exploration Services; Mets Consulting South Africa; Patterson and Cooke; PCDS Consultants; Power Plant Electrical Technologies; Professional Cost Consultants; Promethium Carbon; Shift Innovations; SRK Consulting; Strategy4Good; The MSA Group; Turnkey Civil (International) Group; VBKom Engineering Consultants; Whittle Consulting and Z Star Mineral Resource Consultants.

Contact Details for Project Information
Orion Minerals, tel +27 11 880 3159 or email info@orionminerals.com.au.