JOHANNESBURG (miningweekly.com) - The board of London-based diversified metals and minerals producer Xtract Resources has concluded a further collaboration agreement with Omnia Mining for the exploitation of the hard rock gold deposits at Xtract's Manica mining concession in Mozambique.
This, however, excludes the hard rock gold deposits at the Fair Bride project, which remain under the sole control and management of Xtract.
"The agreement provides Xtract with access to a new fully installed and operational processing plant able to extract gold from ore types available in the Manica area. Within the partner's concession areas, there exist numerous hard rock occurrences, most of which have undergone limited, superficial or no exploration," Xtract executive chairperson Colin Bird said in a statement on Monday.
He further said the agreement provides Omnia with the company's mining and processing expertise and provides Xtract with the opportunity to fast-track the development of a hard rock operation.
Under the terms of the agreement, the companies will explore and evaluate all hard rock exploration targets within the Manica concession, excluding the Fair Bride project, with the aim of being able to convert these targets into a joint mining operation with Omnia, which already has a hard rock processing plant (free gold only) in an adjacent concession under its control.
The joint venture project will be implemented in five phases, which include a desktop study to be completed by no later than February 20 (Phase 1), an exploration phase which will include - but not be limited to - ground geophysical prospecting, mapping, trenching and resource estimation to be completed by no later than April 15 (Phase 2).
Phase 3 will entail drilling to identify and confirm mining targets, which is to be completed by no later than August 15, while Phase 4 will entail an in-house feasibility study to determine whether all targets have passed the internal rate of return benchmark in Phase 3.
Metallurgical testwork will be performed to identify if any upgrading of Omnia's processing plant is required, with the phase expected to be completed by no later than September 15.
Phase 5 will consist of modifications to Omnia's processing plant, which will only be done if the mining material cannot be processed or the modifications will increase the recovery percentage.
Should the project proceed to development, Xtract Resources will be responsible for mining and Omnia will be responsible for processing.
"Apart from the plant, Omnia has existing camp, warehouse and maintenance facilities to support the planned operation. We look forward to working with Omnia on this agreement, as well as our existing collaboration with them on the alluvial mining," Bird commented.