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Sandfire weighing options at DeGrussa

Image shows ore from DeGrussa

Photo by Bloomberg

27th July 2023

By: Esmarie Iannucci

Creamer Media Senior Deputy Editor: Australasia

     

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PERTH (miningweekly.com) – Copper miner Sandfire Resources has taken the decision to transition the DeGrussa mine to care and maintenance, and is now considering a number of alternatives for the mine, including closure, rehabilitation and divestment.

The company transitioned to the processing of oxide copper stockpiles in mid-February this year, after completing the processing of transitional stockpiles and mineralised waste stockpiles.

However, the miner on Thursday said that the challenging economics of processing the increasingly low-margin oxide stockpiles had supported the decision to transition the mine. The high clay content of this material significantly impacted metallurgical recovery and throughput rates, and as the economics became marginal, Sandfire decided to cease oxide processing operations in late May.

“Processing operations at DeGrussa transitioned to care and maintenance during the quarter [ended June] as the economics of processing increasingly low-margin oxide ores could no longer be supported. We are in discussions with a number of parties and all alternatives for the Operation are being considered, including closure and rehabilitation, and divestment,” said CEO and MD Brendan Harris.

Sandfire on Thursday reported that DeGrussa had contributed 1 435 t of copper and 1 234 oz of gold during the three months to June, with Sandfire’s total production for the June quarter amounting to 17 460 t of copper, 25 345 t of zinc, 4 080 t of lead and 1 234 oz of gold.

In the full year ended June, DeGrussa contributed 27 502 t of copper and 19 122 oz of gold, as well as 0.1-million ounces of contained silver.

For the full year ended June, Sandfire’s total production amounted to 84 056 t of copper, 85 929 t of zinc, 10 747 t of lead, 19 122 oz of gold and 2.8-million ounces of silver.

The miner reported a 13% increase in production at its MATSA operations in Spain during the June quarter, while first copper concentrate was also produced at the Motheo copper mine in Botswana, signaling the ramp-up of the operation towards its initial processing capacity of 3.2-million tonnes a year, which is expected by the September quarter of 2024.

“We anticipate a rapid ramp-up in throughput to the initial 3.2-million-tonne-a-year rate, with nameplate capacity already achieved across a number of shifts and a maximum copper recovery of 89% recorded,” said Harris.

“Building on the growing confidence that we have in our newest mine, we were very pleased to see the government of Botswana approve the environmental impact assessment for the A4 project, paving the way for the extension of the Motheo mining licence.

“Contained copper production at Motheo is set to increase to more than 50 000 t in 2025 with development of the higher grade A4 pit, and the rapid and low-cost expansion of the associated processing facilities to 5.2-million tonnes a year, in parallel.

“We continued to enhance our understanding of the geological setting at MATSA, with recent drilling extending the identified strike length of the San Pedro mineralised zone to around 550 m and we are currently testing a further 650 m extension. Pleasingly, we have also identified a new system to the west of Magdalena called the Olivo zone, where massive sulphides over an initial strike length of 300 m have been intersected and drilling is underway to test its lateral extent to the west.”

Harris said that the 2024 financial year was expected to be another transformational year for the company, as incremental growth at MATSA and the ramp-up of Motheo would only be partially offset by the loss of production from DeGrussa, with copper equivalent production set to rise by 10% to 13 500 t.

“The platform that has been established, and the dedication of our teams in Spain, Botswana and Australia, leave us well placed to deliver more than 50% growth from our continuing operations in the two years to the end of the 2025 financial year,” Harris said.

Edited by Creamer Media Reporter

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