https://www.miningweekly.com
Africa|Energy|Environment|Mining|Platinum|Power|PROJECT|rail|Resources|Roads|Solar|Technology|Maintenance|Environmental|Infrastructure|Operations
Africa|Energy|Environment|Mining|Platinum|Power|PROJECT|rail|Resources|Roads|Solar|Technology|Maintenance|Environmental|Infrastructure|Operations
africa|energy|environment|mining|platinum|power|project|rail|resources|roads|solar|technology|maintenance|environmental|infrastructure|operations

Zombie mines are coming back to life on soaring metals prices

14th July 2021

By: Bloomberg

  

Font size: - +

A silver mine in Bosnia and Herzegovina that sat derelict through the years of civil strife that gripped the region from the early 1990s may soon be taken out of mothballs to benefit from an optimistic price outlook.

Adriatic Metals’ Vares project could resume production by the end of 2022 following a hiatus of more than three decades, according to CEO Paul Cronin. It’s part of a nascent trend toward restarting so-called “zombie” mines -- operations which have been shuttered for reasons varying from weak prices to owner bankruptcy or political unrest.

“Some of these old mining assets around the world that have been discarded and dumped are an eyesore -- they’re a problem. They create potential environmental issues that need to be resolved,” Adriatic’s Cronin, a former investment banker, said in a phone interview. “If we can convert the ‘zombie’ into something that adds value, that resolves some of those issues and shareholders can get a return from them, that’s great.”

Miners from Europe, to Australia and South Africa, are being motivated by the commodities price rally driven by the global economic recovery and infrastructure spending tied to the clean energy transition. Anglo American Platinum, the world’s biggest platinum company by market value, has been approached by at least four groups for its idled Bokoni mine, people with knowledge of the matter said last month.

The advantage of recycling old mines, even ones that haven’t been in production for over 30 years, is that you can save costs by using the existing infrastructure, Cronin said. Vares already had rail links and roads in place, and Adriatic was using some of the former site’s facilities including power lines. New technology can also help to make shuttered operations more economically viable. The company is also developing a zinc project in neighboring Serbia.

Mining giant Australia is getting in on the act: Panoramic Resources and Mincor Resources are both restarting nickel operations, having put them on care and maintenance in 2016 in response to weak global prices. At the same time, the Honeymoon uranium mine, which was shuttered in 2014 due to weak prices, could be re-started in 12 months, developer Boss Energy said in a feasibility study, citing the price outlook.

In Mincor’s case, the resumption of its Kambalda mine is backed by an off-take agreement with BHP Group’s nearby Nickel West operation, which is itself enjoying a renaissance amid a surge in demand for the battery metal. Prices have gained about a third over the past year.

A strong price environment had seen miners look at the economics of reopening mothballed operations, said Gavin Wendt, founding director of consultancy MineLife. So far, it had mainly been smaller mines that had re-started, which were unlikely to have much impact on the market, he added.

“A lot of these operations sit at the high end of the cost curve, that’s why they’re not in production now,” Wendt said. “So that tells us they are quite marginal and they are the most vulnerable to movements in commodity prices.” Still, with the infrastructure already in place, re-starting a mine was a relatively low-risk strategy when compared to developing new resources, he added.

Silver has risen nearly 40% over the past 12 months and with the precious metal also in demand for use in solar panels and electric vehicle charging stations due to its conductive properties, Cronin said he is confident that the price outlook remains robust for his project.

Edited by Bloomberg

Comments

Showroom

Immersive Technologies
Immersive Technologies

Immersive Technologies is the world's largest, proven and tested supplier of simulator training solutions to the global resources industry.

VISIT SHOWROOM 
SAIMC (Society for Automation, Instrumentation, Mechatronics and Control)
SAIMC (Society for Automation, Instrumentation, Mechatronics and Control)

Education: Consulting with member companies to obtain the optimal benefits from their B-BBEE spending, skills resources as well as B-BBEE points

VISIT SHOWROOM 

Latest Multimedia

sponsored by

Hyphen, Eva mine, ferrochrome price make headlines
Hyphen, Eva mine, ferrochrome price make headlines
27th March 2024
Resources Watch
Resources Watch
27th March 2024

Option 1 (equivalent of R125 a month):

Receive a weekly copy of Creamer Media's Engineering News & Mining Weekly magazine
(print copy for those in South Africa and e-magazine for those outside of South Africa)
Receive daily email newsletters
Access to full search results
Access archive of magazine back copies
Access to Projects in Progress
Access to ONE Research Report of your choice in PDF format

Option 2 (equivalent of R375 a month):

All benefits from Option 1
PLUS
Access to Creamer Media's Research Channel Africa for ALL Research Reports, in PDF format, on various industrial and mining sectors including Electricity; Water; Energy Transition; Hydrogen; Roads, Rail and Ports; Coal; Gold; Platinum; Battery Metals; etc.

Already a subscriber?

Forgotten your password?

MAGAZINE & ONLINE

SUBSCRIBE

RESEARCH CHANNEL AFRICA

SUBSCRIBE

CORPORATE PACKAGES

CLICK FOR A QUOTATION







sq:0.103 0.136s - 95pq - 2rq
Subscribe Now