Diversified miner Vedanta Resources has approved the investment of $782-million over three years in the development of the Gamsberg-Skorpion integrated zinc project.

About $630-million will be spent on developing a 250 000 t/y openpit zinc mine, a concentrator plant and associated infrastructure at Gamsberg, near Aggeneys, in the Northern Cape.

The balance will be used on the development of an integrated 150 000 t/y roaster at the Skorpion Zinc refinery, in Namibia, to enable it to treat zinc sulphide deposits from the Gamsberg mine to produce high-grade zinc. This will also extend the life of the Skorpion Zinc operation, which was previously expected to close down in 2015.

“The Gamsberg-Skorpion integrated zinc project is central to Vedanta’s long-term aspirations for Southern Africa. The output from Gamsberg, coupled with extending the life of the world-class refinery at Skorpion Zinc, in Namibia, will make the Southern African region one of the most important suppliers of refined zinc globally.

“That will also result in these operations forming one of the cornerstones of our operations in Africa and will partially offset the loss of volume resulting from the end-of-life of the mine at Lisheen, in Ireland,” commented Vedanta CEO Tom Albanese.

Black Mountain Mining, in which Vedanta’s Sesa Sterlite subsidiary holds 74% and South Africa’s Exxaro Resources 26%, will operate the Gamsberg-Skorpion project.

The investment decision was made following the presentation of a detailed feasibility study for the mining project to Vedanta’s board. Work is already under way to establish a pilot plant for the refinery conversion, while preliminary work on financing options has started.

The first phase of the Gamsberg openpit mine is estimated to have a 13-year life span, with the first ore likely to be produced in 2017/18.

About 1 500 jobs will be created during the construction phase, while the mine will provide employment for 500 employees once operational.

Meanwhile, Vedanta last week reported earnings before interest, taxes, depreciation and amortisation of $2.1-billion for the six months ended September 30. Revenue for the six months under review rose 6% year-on-year to $6.5-billion.

Its Zinc India division reported mined metal output of 375 706 t, 18% lower than output in the prior comparable period.

Production at the Zinc International division, which includes its African zinc operations and the Lisheen mine fell 17% year-on-year to 196 000 t.

Refined zinc metal output at Skorpion has been lower owing to unplanned maintenance activities at the mill. Zinc/lead mine output at Lisheen has dropped owing to lower grades, while the Black Mountain mine has experienced grade slippage, also contributing to the lower overall output.

Vedanta expects the Zinc International division to deliver output of between 330 000 t and 340 000 t for the full year, compared with the 364 000 t produced in the financial year ended March 31.