Name of the Project
Prieska copper/zinc project.

Location
In the Northern Cape, in South Africa.

Project Owner/s
Diversified metal explorer and developer Orion Minerals.

Project Description
An updated bankable feasibility study (BFS) has confirmed the potential of the Prieska project to underpin a significant near-term, low-cost, copper/zinc development project, with exceptional opportunities for future growth.

The project has total mineral resources of 30.49-million grading 1.2% copper and 3.7% zinc.

The updated BFS on the foundation phase of the project proposes the development of a new 2.4-million-tonne-a-year copper/zinc mining operation at the brownfield project.

Underground and surface mining methods are planned to be used in conjunction with conventional froth-flotation concentration to produce differentiated copper and zinc concentrates for export.

Peak production is estimated at 23 000 t/y of copper and 88 000 t/y of zinc.

The life-of-mine has been extended by two years, from 9.7 years to 11.5 years.

Material changes in the updated BFS, compared with the 2019 BFS plan, include:

• reducing the mine dewatering timeline and supplementing the treatment of that water,
• incorporating additional mineral resources into the mining plan that will increase the mine life by two years,
• a more conservative timeline to ramp up to steady-state production,
• prioritising the early mining of high-grade zones in the mining sequencing,
• the adoption of semiautogenous grinding mills in the processing flowsheet,
• an owner-miner operating philosophy for underground mining,
• using an experienced contractor to operate the processing plan, and
• a change in the key operational infrastructure being supplied by third-party financing and in the supply of select key operational infrastructure.

The mining methods for the project remain unchanged, compared with those stated in the 2019 BFS. Tunnel development remaining from the previous mining operations allows for early access to underground production mining areas. A combination of longhole open stoping with fill and drift-and-fill mining methods are planned to be used, supported with paste backfill.

Potential Job Creation
Not stated.

Net Present Value/Internal Rate of Return
The project has a net present value, at an 8% discount rate, of A$779-million, compared with A$574-million in the 2019 BFS, and an internal rate of return of 39%, compared with 38% in the 2019 BFS. Payback from first production is estimated at 2.4 years, a decrease of five months.

Capital Expenditure
Total startup capital, including contingency, has decreased from A$400-million in the 2019 BFS to A$373-million in the updated BFS.

Peak funding requirements have increased from A$378-million in the 2019 BFS to A$413-million.

Planned Start/End Date
Orion Minerals is targeting production startup in 2024, market conditions permitting.

Latest Developments
The executive team of Orion Minerals is re-evaluating the development schedule of the Prieska copper/zinc project to assess the potential for its fast-tracking, with the opportunity to extract pillars left by historic mining also flagged.

The early production investigations, due for completion by midyear, coincide with prevailing positive macroeconomic factors and the continued long-term positive outlook for copper and zinc prices.

If approved, opencast mining will run concurrently with the 33-month development phase of the underground Prieska Deeps mine.

The focus is to reschedule the feasibility study’s phased implementation, with studies under way to assess the potential to mine the openpit first, rather than at the end of the mine life.

“This alternative scenario is looking increasingly like the route we should go down,” Orion CEO Errol Smart has said.

The pillars left by historical mining are soon to be tested as part of a 3 500 m underground drilling programme to allow for their inclusion in the mineral resource and reserve estimation.

Management has done the study to determine the likely economic grade of those pillars ahead of taking them to reserve status.

Engineering studies indicate that many of the pillars – left in a grid pattern purely as ground support in the absence of modern backfilling – will not be required for continued geotechnical stability of excavations if cemented tailings filling from the opencast mine are placed in the historical voids as planned in 2020 BFS.

Using cemented openpit mine tailings to back-fill the historical voids also allows for a reassessment of the size of the planned tailings storage facility, which has a high upfront capital cost.

The studies could transform Prieska from being a mine that will take 36 months after financing is in place to have the first revenue to a mine that can be in production in 19 months and potentially come on line in late 2024.

Meanwhile, negotiations with multiple banks and financing institutions for the funding of Prieska's Deeps mine, which are continuing as a priority, are not affected by the engineering studies and financial assessments of early production value enhancement scenarios under way.

The early start does not have to interrupt the mining of the Deeps mine, which can be financed separately and be operated as a project on the side at a time of high-flying copper prices.

Key Contracts, Suppliers and Consultants
Companies involved in the BFS included A&B Global Mining; ABS Africa; BPDT & Co; Bluhm Burton Engineering & Ventilation Consultants; Beulah Africa; Cart Investments; DRA Projects South Africa; Earth Science Solutions; Endeavour Financial Limited; Falcon and Hume Attorneys Inc; Fraser McGill Mining & Minerals Advisory; Knight Piésold; METC Engineering; Gariep Mining and Exploration Services; Mets Consulting South Africa; Patterson and Cooke; PCDS Consultants; Power Plant Electrical Technologies; Professional Cost Consultants; Promethium Carbon; Shift Innovations; SRK Consulting; Strategy4Good; The MSA Group; Turnkey Civil (International) Group; VBKom Engineering Consultants; Whittle Consulting; and Z Star Mineral Resource Consultants.

Contact Details for Project Information
Orion Minerals, tel +27 11 880 3159 or email info@orionminerals.com.au.