JOHANNESBURG (miningweekly.com) – Africa-focused gold and copper exploration and development company Alecto Minerals on Friday announced that its Mowana copper mine, in Botswana, has developed into a full-time copper production operation.
Following the first blasts at the end of April, a successful trial period produced over 1 900 t of copper concentrate, which is being sold to Alecto's offtake partner Fujax Minerals and Energy.
“We look forward to gaining ownership of the project subject to shareholder approval, at which point, we believe, our company will benefit from a significant value rerating. Once effected, we will have taken control of a significant asset which has been subject to more than $150-million of investment in the past, for an acquisition price of approximately $10-million,” said Alecto CEO Mark Jones.
The Aim-listed group is steadily advancing its acquisition of the project through a reverse takeover, with the completed competent persons report (CPR) paving the way for the publication of the admission document required to enable Alecto to recommence trading on Aim.
“We are delighted that the CPR demonstrates the compelling economics of our project even without the installation of a dense media separation (DMS) unit,” he added, highlighting that the report showed a current resource of about 172-million tonnes at 0.84% copper.
The CPR reports a net present value (NPV) of $87.5-million for the initial 12 000 t/y of copper production – which the company intends achieving by the third quarter of this year – based on an average copper price of $2.80/lb at a discount rate of 10%.
Production costs are expected to average $1.50/lb over the mine life, based on an average metallurgical recovery of 91%.
With the mining activities well under way, Alecto plans to undertake additional testwork over the next few months to finalise its decision on the installation of the DMS, which is expected to increase throughput to 2.6-million tonnes a year with output of 23 000 t/y of copper by the third quarter of 2018, enhance the mine’s economics and increase the project's NPV to $245-million.
Alecto has secured conditional funding of $20-million for a DMS from Fujax and NHI.