Bisie project to benefit from forecast tin shortfall

10th February 2017 By: Simone Liedtke - Creamer Media Social Media Editor & Senior Writer

Bisie project to benefit from  forecast tin shortfall

NEW LIFE The Bisie tin project and surrounding development has breathed new life into the economic activity of the local communities of North Kivu

The Bisie tin project’s Mpama North prospect, in the North Kivu province of the Democratic Republic of Congo (DRC), is one of the most significant tin deposits in the world, Alphamin Resources CEO Boris Kamstra tells Mining Weekly, emphasising that no other undeveloped tin asset has as attractive a combination of tonnage and grade as Bisie.

Alphamin Bisie Mining’s (ABM’s) tin project presents an attractive opportunity to develop one of the highest-grade known tin deposits in the world, meet the growing need for tin amid a predicted shortfall and promote economic growth and stability in North Kivu.

Infrastructure development on the project is well under way and construction of the mine will start in the first quarter of this year, allowing for first production of tin concentrate in the fourth quarter of 2018, which is when the International Tin Research Institute (ITRI) has forecast the start of a global tin shortfall.

Kamstra says the research further suggests that production from many existing mines and mining regions may have peaked and that a gradual decline may be expected in future. Tin stockpiles were at an all-time low of 4.2 weeks of consumption last year, as demand continued to outstrip supply.

The ITRI monitors tin projects worldwide and ranks Bisie, in the eastern region of the DRC, as the second-largest project in terms of contained tin and grade.

Bisie has “excellent” metallurgical recovery characteristics and low levels of deleterious materials in concentrate, says Alphamin, and is expected to produce tin concentrate at an all-in operating cost of $8 316/t of tin, after it comes into production. Steady-state production is expected during 2019.

The ABM project’s mineral resource estimates were updated in May 2016, with a declared measured resource of 19 600 t of tin, an indicated resource of 188 400 t of tin and an inferred resource of 22 800 t of contained tin at a 0.5% tin cutoff grade.

The Bisie mine is expected to produce about 9 900 t/y of low-cost, conflict-free tin in concentrate for at least 12 years, but Alphamin believes the life-of-mine (LoM) will be signifi- cantly longer. “The drilling undertaken to date comfortably supports 12 years,” Kamstra notes. This volume represents about 3% of the world’s current production and will double the DRC’s current tin exports.

“One of the greatest threats to the tin industry and end-users is the uncertainty of future supply in sufficient quantities of conflict-free and responsible distribution of tin. However, Bisie will be able to supply the market with sufficient quantities of tin,” Kamstra tells Mining Weekly.

He further explains that all indications are that Bisie is not an isolated occurrence and there are probably more mineralised areas in the area around the project. He notes that it is possible that Alphamin will develop an entire tin province, which will secure supply to industry for many years to come.

Positive Developments

Kamstra points out that drilling programmes have confirmed the significant potential of Bisie and the company took the decision to develop the project based on the extraordinary grades that were being encountered, combined with the excellent metallurgical recoveries that underpinned a strong business case.

“Once we were sufficiently comfortable that we would be able to execute our plans successfully, we had to convince others. Initially, people were somewhat skeptical [of our] being able to complete a drilling campaign on a hill, in a jungle and relatively far from most infra- structure, let alone build a mine there.”

Subsequently, the company has made positive strides, which include releasing a National Instrument 43-101-compliant resource statement and confirming a significant increase of 34% in its mineral resources at the Mpama North prospect at Bisie. The results underpin excellent potential to define significant additional tin resources to increase the LoM at Mpama North, thus unlocking further investment potential.

Kamstra explains that the 34% increase in the resource over the figure announced in October 2015 was the consequence of the drilling programme which was still ongoing at that stage.

“This positive development confirms the high quality of the project and is another step towards the development of the mine at Mpama North. These results support an increase in tin grade, with tin mineralisation continuing downdip and open along strike and at depth.”

He points out that, in the early days of the project, the company received cautious encouragement from most businesses but no public support. However, as the company and the project have made progress, support and enthusiasm have escalated.

“Support has been on all levels, from the communities we are working with to the upper levels of the DRC’s leadership. A wonderful example of this is the recently established – December 2016 – committee in the North Kivu government to assist Alphamin in bringing the project to production.”

In January, it was announced that the Bisie mining project had received official endorsement, with a strong vote of government support when the North Kivu government support committee for the development of the tin project was established.

“As the Bisie tin project moves forward with road and preliminary construction activities, including the ventilation tunnel, we are seeing increasing support from local and national stakeholders through actions such as those of the North Kivu governor,” states Kamstra.

Besides support, site accessibility was another challenge, but this is being solved with the development of an access road. The road is being upgraded to provide access to the site for most vehicles, allowing for the mobilisation of mineworkers and heavy machinery needed to build the mine.

Kamstra explains that the upgrade will be completed in phases. The first phase is to get a running surface that most vehicles can traverse and then this will get upgraded further with solid wearing courses. “By the end of this year, we expect to have an all-weather road to Bisie.

“Infrastructure within the Bisie project area is nonexistent or in a poor state of repair. Thus, the project will require significant investment [not only] in road access [but also in] power generation and waste management,” Kamstra adds, noting that a base camp has been constructed at the Mpama North site.

He says, beyond the core mining development, it has been exciting to see the impact Alphamin has had on the surrounding community.

The project has already made a significant contribution to the area. The community now has cellphone connectivity, owing to a tower operated by telecommunications services provider Vodacom. Kamstra says the tower has enabled small local businesses to boom, breathing new life into the economic activity of nearby local communities.

It is anticipated that ABM will employ about 700 people during construction and will create about 450 permanent local jobs during operations. As a result, significant economic benefits are expected in the DRC, which has seen little foreign investment while overcoming security and governance challenges for decades.

“Alphamin and North Kivu role-players understand the project will serve as an example for foreign investment and will also serve as an infrastructure platform for other businesses to start, including service providers to the mine,” Kamstra explains.

He further enthuses that indirect job creation will be far higher than the mine’s direct numbers and can be reasonably expected to achieve the 1:14 ratio of indirect jobs commonly reported in Africa for similar projects, potentially resulting in an additional 6 300 jobs.

“The impact and contribution to the international tin industry and the benefit for the local DRC economy will be significant. We will add value to the people of North Kivu by unlocking the value of the region’s conflict-free tin. For investors, it makes sense to invest in this project that is bound to show excellent returns,” Kamstra concludes.