Weatherly’s new Tschudi project taking the miner to new heights. The UK based, AIM listed, Namibian focused copper company is unique, they produce, develop and explore for copper. Since reopening two of its underground copper mines in early 2011, Otjihase and Matchless, Weatherly has been ramping up production to reach a current production rate between 5,000 -6,000 tpa.
Today Weatherly is a small, unique copper producer, but as the only one on the AIM market significant none the less.
But starting on the 8th of November 2013 Weatherly’s profile is set on a new growth path. The ground breaking ceremony for their transformational Tschudi Copper project, to be attended by Namibian Government officials and Weatherly’s management, is the first significant step, post funding, to get the mine into production.
Tschudi is an open pit mine utilising a SW-EX (Solvent Extraction-Electro-Winning) processing method which is extremely cost effective. Tschudi will produce 17,000 tonnes of copper a year and will be a massive step forward for Weatherly and take it from being a junior listed AIM company to a mid tier copper producer and put it on everyone’s radar.
Orion Mine Finance has supplied a loan facility of US$ 91 million to develop the Tschudi mine, which has 50.1 Mt of resources at 0.86%Cu and 22.7 Mt at 0.95% Cu. Weatherly forecasts an 11 year life of mine, over which 17 Mt will be mined and 17,000t produced each year. The company expects to recover 184,275 of copper over the course of the mine life.
Feasibility results present low costs for the Tschudi mine with cash costs estimated at $1.94 per tonne, initial capital is estimated at approximately US$ 81 million; life of mine capital at US$ 109 million. Using industry consensus prices on copper and exchange rates, the after tax Net Present Value (NVP) is US$ 105 million and the Internal Rate of Return (IRR) 32.1%, resulting in a payback time from start of production of 2.43 years. If we take December 2012 figures then the NVP is US$238 million, the IRR is 50.8% and payback is achieved after 1.98 years.
The Tschudi ground breaking ceremony gets the development of the mine under way and puts Weatherly on a real growth trajectory. The mine will probably be in the bottom quartile of new copper projects worldwide, if you take overall capital and operations costs into account. Weatherly expects the project to be producing in approximately 16 months from drawdown.