RGN Vol 6 Iss 1

RESOURCE Volume 6, Issue 1

GLOBAL NETWORK

Mining, renewable energy and oil & gas worldwide

WELCOMES PRESIDENT RAMAPHOSA!

ON-SITE AT MINING INDABA

March 3 – 6 Metro Toronto Convention Centre Toronto, Canada

25,000+ ATTENDEES from 135 COUNTRIES

REGISTER AT pdac.ca/convention

550+ SPEAKERS

3,500+ INVESTORS

2019

1,100+ EXHIBITORS

MINING | Brookfield Multiplex

WELCOME

The Investing in African Mining Indaba is widely recognised as a strong indicator of the general health of the international mining sector at the beginning of each year. When attendance is up year-on-year, deals go up and confidence proliferates across the industry.

Executive Team Editor Jacob Ambrose Willson

The annual event, held in Cape Town during the first week of February, is the world’s largest mining investment conference and has supported the development of African mining since 1994 – making this year’s Indaba a landmark 25th edition.

Content Director (APAC and Americas) David Hunter

Reaching this milestone called for an event that would celebrate the role Indaba has played in connecting the industry with Africa while supporting socio-economic development on the continent over the last two and a half decades, but also one that would be bigger and better than all before it.

Creative Director Hugo Currie

True to its word, Indaba delivered a first-class event in 2019 to over 6,000 delegates from major and junior mining companies, service providers and investors, along with a bigger than ever governmental presence that was capped by South African President Cyril Ramaphosa’s formal address to the industry.

ICT Director Stuart Clark Managing Director Simon Curran

RGN is an exclusive media partner with the event organisers and attended the landmark 2019 Indaba in Cape Town. This issue offers a full review of the event, on-site interviews and a host of profiles on miners with exploration projects and producing assets across Africa.

Many of our feature companies figured heavily in this year’s Indaba, including South African vanadium producer Bushveld Minerals, Investment Battlefield finalists Prospect Resources and Theta Gold Mines, plus West African gold explorer Cardinal Resources. You can explore their stories in the following pages.

Everyone at RGN would like to say thank you and congratulations to Indaba for a fantastic 25th anniversary event. Here’s to another quarter century of championing Africa’s sustainable economic development!

Jacob Ambrose Willson, Editor

Jacob Ambrose Willson

RGN is published by Anderson Murray Media: a diverse media and information services company focused on creating and distributing engaging content to business leaders across the globe.

Anderson Murray Media Fulham Green, 69-79 Fulham High Street, Main Reception, Bedford House, London SW6 3JW Tel. +44 (0)207 148 5630

VISIT US ONLINE AT WWW.RESOURCEGLOBALNETWORK.COM

CONTENTS NEWS 10 Global resources news Our selection of mining, oil & gas and renewable energy stories from the last month

RGN ONSITE AT MINING INDABA 2019 18 Mining Indaba review The world’s leading mining investment conference celebrates 25 years 38 Women in Mining South Africa RGN meets the advocacy group for women in South Africa’s mining industry 48 ICMM ICMM releases its latest mine closure guidance at Mining Indaba

CONTRIBUTORS 60 Thomas Hillig (THEnergy) Renewables help African miners reduce their carbon footprint 68 Julia Baxter (Adam Smith International) The growing concept of shared value in the mining sector 76 Michael Cronwright (The MSA Group) Considering Africa’s bright prospects in the booming critical materials mining space

AFRICAN MINING 84 Bushveld Minerals The vertically integrated primary vanadium producer 96 Prospect Resources Glittering prospects for this miner in the African lithium space 110 Consolidated Nickel Mines Restarting the Munali Nickel Mine in Zambia 120 Theta Gold Mines A new name for a company operating in South Africa’s oldest goldfield 132 Cardinal Resources Gold exploration in Ghana’s underexplored Northeast

MINING INDABA REVIEW

BUSHVELD MINERALS

PROSPECT RESOURCES

CONTENTS

CARDINAL RESOURCES 144 Hummingbird Resources RGN checks in with Hummingbird Resources’ MD Dan Betts 156 Indiana Resources A growing gold focus in Mali 168 Midnight Sun Mining Staking a claim in Zambia’s copper-rich North-Western Province 178 Kogi Iron Nigeria’s first primary steel production project

APPOINTMENTS & EVENTS 192 Appointments Notable appointments in the resources industry from the past month 193 Events Our pick of the top forthcoming mining, oil & gas and renewable energy events

HUMMINGBIRD RESOURCES

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NEWS | Brookfield Multiplex MINING

GLOBAL RESO

Our selection of mi renewable energy news

Resource Global Network 11

OURCES NEWS

ining, oil & gas and s from around the world

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NEWS

MINING INDABA OFFICIALLY OPENS MARKET TRADING ON LSE Investing in African Mining Indaba officially opened trading on the London Stock Exchange (LSE) on Friday January 11th, ahead of its landmark 25th anniversary event in the first week of February.

The market was opened by Mark Shashoua, CEO of ITE Group plc, which acquired Mining Indaba for around £30 million in October as part of its strategy to build a portfolio of world-class, large scale events.

“I am delighted to be opening the LSE today with the Mining Indaba team, which ITE Group recently acquired, and with our industry partners and friends,” said Shashoua.

“Mining Indaba is a fantastic event that is dedicated to developing the mining industry across the African continent and it also further cements our partnership with the LSE Group.”

The proceedings were also attended by members of the Mining Indaba team, including managing director Alex Grose, who was presented with a plaque to commemorate the opening of the market.

“This ceremony further cements our partnership with the LSE Group, supporting our main aim of helping mining companies access capital,” said Grose.

Resource Global Network 13

NEWMONT BECOMES WORLD’S BIGGEST GOLD FIRM THROUGH $10 BILLION GOLDCORP PURCHASE Newmont Mining Corp will acquire Canadian rival Goldcorp in a deal valued at US$10 billion which will create the world’s biggest gold producer by output.

The share-based deal brings together two giants of the global gold sector who produced a combined 7.9 million ounces (Moz) of gold in 2017.

The combined outfit, named Newmont Goldcorp, will operate across the Americas, Australia and Ghana, tapping into the world’s largest gold reserves and resources, the companies said.

Goldcorp’s CEO David Garofalo said: “The strategic rationale for combining Goldcorp with Newmont is powerfully compelling on many levels.”

Meanwhile, Newmont’s chief executive Gary Goldberg will lead the combined company, following a strategy that he said will realise the full value of the merger.

The plan involves asset divestments of between $1-1.5 billion over the next two years in order to optimise gold production to 6-7Moz annually over the next 10 years.

The deal closely follows the completion of the $18 billion-valued Barrick GoldRandgold Resources mega-merger, which has drastically altered the composition of the global gold mining sector with further large M&A deals expected over 2019.

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NEWS

VALE TO SLASH PRODUCTION AS FIVE ARRESTED IN WAKE OF BRAZIL DISASTER Vale will take up to 10% of its output offline to decommission 10 dams similar to the one that burst on Friday January 25th in the Brazilian town of Brumadinho, killing at least 84 people with hundreds still missing.

The decision to cut production was announced by Vale’s chief executive Fabio Schvartsman as the company faces up to its appalling recent safety record, following the second fatal dam collapse in Brazil in just over three years.

The move is expected to cost Vale US$1.3 billion over the next three years and will involve suspending operations at mines producing 40 million tonnes of iron ore and 11 million tonnes of pellets per year.

News of Vale’s output cuts sent metal prices soaring along with the share prices of its rival miners, including BHP, Rio Tinto and Fortescue Metals Group. Chinese iron ore futures jumped in early trade on Wednesday, while Australia’s benchmark metals and mining index had its best day in two years.

Meanwhile, Brazilian police carried out five arrests in São Paulo and Belo Horizonte as a criminal investigation begins into the causes of the dam collapse at the Feijao mine. Police arrested three Vale employees and two engineers from German auditor firm TUV SUD.

Resource Global Network 15

MAJOR OIL & GAS DISCOVERY A GAME-CHANGER, SAYS SA PRESIDENT RAMAPHOSA South Africa’s President Cyril Ramaphosa has described an offshore oil and gas discovery as a potential game-changer for the nation’s future energy security.

In early February, French oil major Total announced that it had opened a ‘world-class’ oil and gas province off the coast of Mossel Bay at its Brulpadda block in the Outeniqua Basin. Other partners in the consortium include Qatar Petroleum, Canadian Natural Resources and Main Street.

Ramaphosa was quick to comment on the discovery in his state of the nation (Sona) address on Thursday: “We are extremely encouraged by the report this morning about the Brulpadda block in the Outeniqua Basin, which some have described as a catalytic find,” he said.

“We congratulate Total and its various partners and wish them well in their endeavours. Government will continue to develop legislation for the sector so that it is properly regulated for the interests of all concerned,” he added.

The Brulpadda find is primarily gascondensate and has been estimated at about 1 billion barrels by operator Total ASA, which could be enough to supply South Africa’s refineries for almost four years.

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MINING | Mining Indaba 2019 review

All images/videos credited to Mining Indaba

Resource Global Network

MINING INDABA 2019 REVIEW WRITTEN BY JACOB AMBROSE WILLSON

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MINING | Mining Indaba 2019 review

On the eve of its landmark 25th anniversary, the Investing in African in African Mining Indaba promised an event that would be bigger and better than ever before in 2019. This seemed like a tall order considering the Indaba is already the world’s largest mining investment conference, however the organisers delivered a truly first-class event that married exciting new initiatives with a star-studded cast of industry giants and governmental ministers in the beautiful Cape Town surroundings. Around 6,000 delegates flocked to the event over the course of the week, many of whom came to see South Africa’s President Cyril Ramaphosa formally address the industry – the first time a sitting president had ever taken to the podium at the Indaba.

Ghana’s President Nana AkufoAddo also took to the stage at the event along with 37 ministers of state from across the continent, giving the Indaba a governmental presence matched by no other industry conference.

Championing Africa’s sustainable economic growth In 2019, the organisers aimed to continue championing Africa’s sustainable economic

Resource Global Network

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MINING | Mining Indaba 2019 review

growth by offering a conducive environment

meetings took place during the week and

for deal-making, believing that the Indaba

millions of dollars’ worth of deals were

has a crucial role to play in the development

secured. The success of the Indaba in this

of the mining sector and the economy across

regard also points to a sense of renewed

the continent.

optimism in the industry, as the event is generally held up as a reliable barometer of

Indeed, the importance of the Indaba was

the health of the mining sector, particularly in

underscored by the fact that thousands of

South Africa.

Resource Global Network

“A noticeable change this year from 2018

positive regulatory environment in South

has been the improved mood and sentiment

Africa.”

amongst all delegates, who have been much more optimistic and upbeat, said Indaba’s

This sense of improved confidence in the

MD Alex Grose. “This signalises a positive

industry was cultivated not long after the

shift in the mining industry and growing

Indaba’s grand opening on day one, when

confidence globally in the mining sector,

South Africa’s Minister of Mineral Resources

improved commodity prices and a more

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MINING | Mining Indaba 2019 review

SA mineral resources minister Gwede Mantashe Gwede Mantashe gave a keynote address

delivered certainty in terms of legislative

that struck a positive tone for investors in the

guidance.

nation’s mining sector. “The policy and legislative framework were Since taking over from Mosebenzi Zwane

[in the past] marked with concern about

in February 2018, Mantashe has been

uncertainty. That has been addressed and

instrumental in pushing through a revised

investors coming to South Africa now know

Mining Charter, which he believes has

what they need to do,� he said.

Resource Global Network

Mantashe’s speech kicked off a jam-packed

the investment battlefield stage where the

day of presentations on the main stage, with

fiercely fought competition for junior miners

topics ranging from resource nationalism

commenced.

to climate change, sustainable mining and battery metals.

A successful first day of the Indaba was rounded off by an invite-only reception

Meanwhile, on the exhibitor floor the

called 25 Years of Gold in Africa and around

room buzzed with activity, particularly at

the World, which RGN attended on the roof

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MINING | Mining Indaba 2019 review

President terrace of the Cape Town International

Presidential day

Convention Centre.

On day two, the Indaba provided a rare opportunity for delegates to hear from two

The event was hosted by the World Gold

African heads of state – Nana Akufo-Addo of

Council in partnership with Minerals Council

Ghana and South Africa’s current President

South Africa and This is Gold, featuring a

Cyril Ramaphosa. The highly anticipated

series of compelling speeches from leaders

presidential day kicked off with Akufo-Addo

of some of the biggest gold companies in

calling for the mining industry to use its

the world, including Mark Bristow, Neal

economic power to make African people

Froneman and Niël Pretorius.

prosper.

Resource Global Network

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PRESIDENT CYRIL RAMAPHOSA’S 10-POINT PRINCIPLES FOR MINING IN AFRICA

1. Encourage growth in shared value 2. Partner with, and help educate, local government 3. Invest in the living conditions of workers

t Cyril Ramaphosa speaks at Mining Indaba “Africa has made the world rich with our minerals. Our gemstones adorn crowns and homes around the world. It is time to make Africa prosperous, and enable her people to attain a dignified standard of living. Join us in this exciting project for sustainable economic

4. Educate, and re-skill, local communities 5. Partners with training colleges and academia 6. Embrace beautification to add value locally 7. Pay increased attention to the health and safety of workers 8. Provide internships and job opportunities for the young

growth,” he said.

9. Be proactive in providing job opportunities for women

Later in the day, Ramaphosa delivered a

10. Have the courage to include workers as shareholders, and unions onto boards

rousing speech to a full capacity audience on the main stage, which laid out his unwavering

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MINING | Mining Indaba 2019 review

Ghana President Nana Akufo-Addo greeted at Indaba

Resource Global Network

confidence in the national mining industry,

One element that runs through each of the

despite years of stagnation as a result of

10 points, and something that Ramaphosa

ongoing policy uncertainty.

stressed throughout his presentation, was the need for the industry to work

“Many say that the sun is setting on the

collaboratively with all stakeholders, including

South African mining industry after years of

government, the workforce and communities.

leading the economy. We are firm believers that South Africa’s mining industry is still in

“We are here together on a journey of

its sunrise days, and long will those days last,”

inclusive development in South Africa’s

the president proclaimed.

mining industry. Today I want to say this collaborative approach means we all have

During his 90-minute speech, Ramaphosa

tasks. I believe that in doing so we have

unveiled a detailed plan for mining

our own responsibilities as government,

companies to strive towards in what he called

companies, labour and communities.

’10 Value Creating Principles for a more modern, successful and productive mining

“It is through creating shared value that we

industry’.

can ensure a sustainable mining industry,” Ramaphosa concluded.

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MINING | Mining Indaba 2019 review

President Cyril Ramaphosa

Resource Global Network

Harry Greaves collects Investment Battlefield award

The show goes on

responsible mining companies, the details of which can be found in the subsequent pages

The Indaba reached new highs on day

of this issue. ICMM’s membership includes

three, with ministerial addresses and panel

Anglo American, Barrick, Glencore and

discussions coming thick and fast across the

Newmont.

four stages. On the main stage, the highly competitive investment battlefield reached

Back on the main stage, the Investment

its climax ahead of the Indaba’s glitzy 25th

Battlefield reached the final round, after 22

anniversary party in the evening.

junior miners had been whittled down to just four as the week progressed. Prospect

Meanwhile, the International Council on

Resources, Avenira Ltd, Theta Gold Mines

Mining & Metals (ICMM) used the Indaba

and Orion Minerals presented their stories to

as an opportunity to release a new mine

the audience and the ‘Dragon’s Den’ judging

closure guidance for its members and other

panel ahead of the crucial final decision.

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MINING | Mining Indaba 2019 review

Young Leaders day

Resource Global Network

Anglo American Gala Dinner

RGN & Mining Indaba MDs Simon Curran and Alex Grose

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MINING | Mining Indaba 2019 review

Olebogeng Sentsho, CEO of Simba Mgodi Fund Leaders of Tomorrow winner After much deliberation among the judges,

The Indaba hosted its Young Leaders

it was announced that Prospect Resources

Programme in partnership with global

were the winners of the 2019 Investment

advisory firm Brunswick Group, and

Battlefield and executive director Harry

welcomed the next generation of mining

Greaves was invited on stage to collect his

professionals to connect with current CEOs,

award. Prospect is advancing its Arcadia

ministers and government leaders in a

Lithium Project in Zimbabwe – Africa’s second

packed morning of networking.

largest hard rock lithium project.

The final flourish

Brunswick’s senior advisor Hilary Joffe was front and centre throughout the programme,

There were perhaps a few sore heads at the

and was joined by Gwede Mantashe, who

Indaba on day four, following the hugely

book-ended the Indaba by reminding

successful 25th anniversary party at Cape

delegates that ‘young people will be at

Town’s V&A waterfront the night before, but

the heart of digital mining in the future’.

those who made it to the event’s final day

Other speakers including outgoing chair of

were offered a window into the future of the

Women in Mining South Africa (WiMSA) Lindi

mining industry.

Nakedi and Bushveld Minerals CEO Fortune Mojapelo.

Resource Global Network making than ever before. On behalf of everyone at the Indaba, Alex Grose declared the 2019 event the best one yet when speaking to RGN. “This year cemented and expanded on the successful revamp of the event in 2018 and attracted even more delegates from our key audiences – Governments, major mining companies, junior miners, investors and service providers.

“We are already working on new features for 2020 on both content and technology fronts.

However, we don’t want to spill the beans just yet – stay tuned for more information!

What we can say at this stage is that like

Carole Cable – Brunswick partner

everything else we try to do, the new features we’re currently developing are set to further improve our clients’ experience.

The Young Leaders Programme and the 2019

“We will also see an improved offering for

Mining Indaba was drawn to a climactic close

lawyers and insurers at the conference,

after the winner of the Leaders of Tomorrow

specifically focused around risk management

competition was announced. Congratulations

and a greater involvement from Chinese

to Olebogeng Sentsho, CEO of Simba Mgodi

investors and companies,” concluded Grose.

Fund for picking up the award. Simba Mgodi is an incubation fund designed to support

Everyone at RGN would like to say thank

mining entrepreneurs.

you and congratulations to the Indaba for a fantastic 25th anniversary event. See you

After four content-bursting days, the Mining

again in 2020!

Indaba was concluded for another year.

The landmark 25th edition featured more ministers, more initiatives and more deal-

a j

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MINING | WiMSA

Resource Global Network

WiMSA

meets the advocacy group for women in South Africa’s mining industry

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MINING | WiMSA

In the build-up to the 2019 Investing in African Mining Indaba, its organisers identified a number of key themes that would be explored throughout the landmark 25th anniversary event. One of the themes high on the agenda was women in mining, after Mining Indaba came out in support of a move to a more diverse future in the sector. As well as incorporating a number of interesting sessions on gender diversity in mining, the event also pledged to include at least one female in each panel discussion. Mining Indaba also partnered with three organisations advocating women in mining, including Women in Mining South Africa (WiMSA). During the event RGN’s editor Jacob Ambrose Willson caught up with WiMSA’s current chair Thabile Makgala to discuss her own personal experiences as a woman in South Africa’s mining industry, as well as the work WiMSA does to support female miners.

Jacob Ambrose Willson: To start, can you tell me about your own experiences as a woman building a successful career in South Africa’s mining industry?

Resource Global Network

THABILE MAKGALA Thabile Makgala is the executive: mining at Implats. Prior to joining Implats, Thabile held various senior positions at Gold Fields, AngloGold Ashanti and Anglo American. In 2018, she was selected as one of the “Top 100 Global Inspirational Women in Mining” worldwide.

Thabile is the current chairperson of Women in Mining South Africa and made history by being the first female mining engineer graduate at Gold fields’ Kloof and Driefontein division (Now Sibanye Gold).

In recognition of her vision, leadership and achievements, Thabile was requested by Mining Indaba to present at various platforms on topics of women empowerment in business and the need for change in business by harnessing the potential of women in South Africa. Thabile is passionate about mining, transformation and the advancement of the industry through harnessing technology and innovation.

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MINING | WiMSA

Resource Global Network Thabile Makgala: Working in the mining industry in South Africa as a woman is a tough journey to go through. As you know historically women were not allowed to work in the mines, but when we were finally allowed to go into the mines, I think the industry was not ready to accommodate us.

So, its been a tough journey not just for me but for all women in the industry.

But I think with perseverance and courage we are able to overcome these obstacles. To be successful in this industry you also need help along the way. There is only so much you can do by yourself without any help in the shape of mentoring and guidance. Throughout my path in the industry I have come across many people that have helped me to get to where I am today.

JAW: When you began in the industry, were those support networks in place or have they been a more recent development for women in mining?

TM: No, when I began there were no such support networks. WiMSA was established in 2010 and my first time underground was back in 2001, so you can see it took some time to get an organisation like WiMSA going.

Those networks were not there, which made it even more difficult for women to accelerate their careers in the industry.

JAW: During your time in the mining sector, have you noticed the obstacles facing South African women getting

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MINING | WiMSA smaller or remaining the same?

TM: There has been very little progress that has been made, so the obstacles are still there. The obstacles are not increasing but it is taking a long time to overcome the obstacles that have been present for years.

We as an organisation are working towards raising awareness within the industry, on workplace parity and parity of pay to name a few. Those obstacles are still there but we are overcoming them slowly but surely.

JAW: In what ways does WiMSA aim to address the challenges faced by women in the mining sector?

TM: The purpose of WiMSA is to advocate for women in the mining industry. We want to highlight the challenges that women still experience in the working places. That’s our key function. We are a free platform to use, so women can come and interact with each other and get guided and mentored, at no cost.

WiMSA also facilitates various mentoring events for women in the mining industry. It’s really about advocating and highlighting the challenges to the industry that women still experience.

JAW: Young women still aren’t given the same opportunities to get into mining as men, often due to unfair gender stereotyping. How important is it that

Resource Global Network

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MINING | WiMSA

women with a passion for mining be

We need to let them know what the art of the

encouraged into the mining industry

possible is. As WiMSA we are going to take

rather than discouraged?

that upon ourselves and push for greater education around the opportunities for

TM: I think we have done an injustice to

women in mining.

young South African women, because we haven’t educated them enough about the

JAW: Here we are at the 2019 Investing in

possibilities of the industry. They see from

African Mining Indaba. How has WiMSA

afar the challenges, but there are so many

been promoting itself at the event?

opportunities in mining that they do not see.

TM: I think the Indaba has provided a great Especially with the fourth industrial

platform for WiMSA. Along with Webber

revolution coming upon us, the work does

Wentzel, we hosted a breakfast featuring

not need to be physical anymore. It will

expert panellists to coincide with the Mining

become more and more about thinking. We

Indaba’s women in mining theme.

need to educate young women about the opportunities in the industry and I don’t think

We have also partnered with Mining Indaba

we have done it very well previously.

and provided some of the speakers, because they wanted to have at least one female speaker on the panels this year. Myself and

Resource Global Network about possible careers in the mining industry.

That is definitely a key focus for us, especially with technology and innovation becoming more important in the sector, we want to make women aware of career opportunities in mining. We will continue with our mentorship and networking events that we plan and we will continue to advocate and engage with other stakeholders to highlight the importance of WiMSA. The organisation is mostly focused in the Johannesburg area, so we want to expand it into other regions like Mpumalanga, and Rustenburg in the North West. We call that our regional interventions and still want to enhance those. our outgoing chair Lindi Nakedi have sat on such panels. The partnership has been great

We also want to foster more collaboration

and we hope that it continues into next year

and will look at working with other industry

when there will be not just one woman per

bodies to highlight the challenges facing

panel, but two or three women per panel.

women in the mining industry.

JAW: Finally, tell me about WiMSA’s

Last but not least, we will be celebrating all

plan throughout 2019. You mentioned

our successes and challenges at our annual

educating young women as a key

year-end function held in November of each

consideration going forward, will this be a

year. Those are the plans for WiMSA for the

key part of your plans this year?

year.

TM: Absolutely. The education of our women,

JAW: Thanks a lot for your time Thabile, all

especially at high school level is key and

the best for the year ahead.

WiMSA partakes in that. We have an annual career fair, where we educate young women

TM: Thank you.

ab j

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MINING | ICMM

Resource Global Network

ICMM

ICMM releases its latest mine closure guidance at Mining Indaba

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MINING | ICMM

At the 2019 Investing in African Mining Indaba, the International Council on Mining and Metals (ICMM) hosted an event called Innovations in Mine Closure, in partnership with World Bank and Intergovernmental Forum (IGF). The session was scheduled to coincide with the launch of ICMM’s new Integrated Mine Closure: Good Practice Guide, as part of its drive to encourage and facilitate best practice on planning for and implementing effective mine closure in the mining industry. RGN caught up with ICMM’s chief operating officer Aidan Davy to discuss the guidance, the Mining Indaba and the organisation’s strategy in 2019 and beyond.

that our members can publicly commit to. That defines clear performance expectations across 38 performance areas that are grouped under our 10 principles for sustainable development.

Over the next few months we will be finalising the guidance on assurance and validation for the performance expectations.

We believe they represent the most farreaching initiative to advance environmental and social performance within the mining industry, because they will apply to roughly 650 operational assets of our member countries in over 50 countries. That represents a very significant chunk of the world’s major commodities.

JAW: Earlier this week at the Mining Indaba, you took part in a session on developing mines of the future through sustainability-driven innovation.

What were the key dimensions of this discussion?

Jacob Ambrose Willson: ICMM has brought in the new year with a new

AD: One of the specific initiatives I shone a

three-year strategy and has made

light on is our work around innovations for

changes to its performance expectations.

cleaner, safer vehicles which we launched

How will these changes strengthen

back in November. There are three strands

ICMM’s benchmark for responsible

to this, with the first piece looking at

mining?

reducing greenhouse gas (GHG) emissions by introducing GHG-free service mining vehicles

Aidan Davy: In terms of the work around

by 2040.

performance expectations, what we’ve been looking to do is almost redefine

As a companion piece, we are looking to

what mining with principle looks like in

minimise the operational impact of diesel

practice, by setting a strong benchmark

exhausts, particularly in underground

for environmental and social performance

workings by 2025. The third strand is looking

Resource Global Network

to

I’ve

make

been

collision

really

avoidance technology much more widely available to mining companies by 2025.

struck by the extent to which we have seen sustainable development move from the margins of the agenda to the mainstream

JAW: How beneficial is it for the

of the conference.

sector that an event like the Indaba is hosting a full day on sustainable

The organisers of the Mining Indaba

development, bringing together various

really should be congratulated for how they

stakeholders to discuss various topics?

have brought people together to discuss sustainable development. It’s a big year for

AD: I have been attending the Indaba

them, celebrating their 25th anniversary and

frequently since 2008 and I think it’s

I think they have done tremendous work to

incredibly important. Over the past decade,

bring sustainable development to the fore at

51

52

MINING | ICMM

products.

I think the other point is that in the past we have often regarded a report launch as a the event.

one-time event. Increasingly, ICMM tends to not look at a report launch as a single moment in time, but we look to

JAW: ICMM

promote the guidance on an iterative basis.

has used this year’s Indaba as an

We have learnt that continuing to create a

opportunity to release

consciousness in people’s minds on these

its new mine closure guide. How crucial is it to drive the guidance at a major industry event where the entire

things is critically important. We will try to sustain that focus and continue to promote this work through social media on an ongoing basis.

industry is concentrated for one week?

JAW: This latest guidance is an updated AD: It’s a great opportunity when you have so

version of the 2008 Planning for Mine

many companies representing one space to

Closure toolkit. How has ICMM developed

try and promote the launch of these kinds of

Resource Global Network

its mine closure guidance over the last decade? companies AD: As an organisation we tend to deal with issues that are pressing at a particular

now needed to integrate this into implementation.

point in time. We want to make sure we are actively engaged across new policy development and aim to fill any gaps in good practice guides.

Then for a variety of reasons the sense became that practice was moving on, and so in the last two years we re-engaged on

When we last did a substantial piece on

the issue of closure with the membership

closure the sense was that we had covered

in a much more substantive way. In some

the bases. The 2008 Planning for Mine

ways, there is a natural rhythm and things

Closure toolkit was state-of-the-art of its

come to the surface as pressing or prevalent,

time and for many years it was our most

especially where good practice may be

downloaded publication. At the time, the

absent.

sense was that ICMM’s job was done and

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54

MINING | ICMM

“It’s the classical phrase of its never too late to start retirement planning. Likewise, it’s never too late to start closure planning. For all mining companies there are enormous dividends to be gained from implementing a holistic approach to closure.”

Aidan Davy, chief operating officer ICMM

by miners in the last decade? Does this add an extra layer of importance to your new guidance practice?

AD: The reality is that we have thousands of orphaned and abandoned mine sites around the world and I genuinely believe that is not reflective of modern practice. These abandoned mines risk undermining trust in the mining sector’s commitment to close mines responsibly, and that has really helped ensure that mine closure has become a very significant issue facing mining companies, Over time, good practice has to evolve and

communities and governments around the

I think that need to upgrade what was out

world.

there started in 2016 and gained momentum in 2017 and 2018, where the bulk of the work

I think we are seeing the prospect of a

was developed.

significant number of planned mine closures come into play over the next decade and

JAW: To what extent do you think effective

that really does offer a unique opportunity

mine closure policies have been neglected

to learn from the lessons of the past and

Resource Global Network

improve performance going forward.

JAW: One of the points I picked up during the ICMM’s Innovations in Mine Closure session was the importance of progressive closure planning. Conversely, in what ways can ICMM best advise mining companies who are already well into the production life of their mines?

AD: What is interesting is that in practice, that describes the situation that most of our company members find themselves in for most of their assets. They are already well into production, but it doesn’t mean they are

extended through further exploration and

placed at a disadvantage unless they are in

development.

a very advanced stage of the mine life cycle and closure is imminent. For the most part,

It’s the classical phrase of its never too late

companies are operating assets where there

to start retirement planning. Likewise, it’s

is still a reasonable amount of time left on

never too late to start closure planning. The

the clock, and in many instances that will be

earlier you can do so the better, but even for companies that have well advanced mine

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56

MINING | ICMM operations, there are enormous dividends to be gained from implementing a holistic approach to closure.

JAW: How useful was it have broad and constructive conversations with different stakeholders such as IGF and the World Bank during the Innovations in Mine Closure event in Cape Town?

AD: I think there is a risk sometimes if we only engage with a narrow set of industry stakeholders, you find yourself in the echo chamber where we are all saying the same things and are in violent agreement with one other.

In particular, the value proposition of having

JAW: What have you taken away

organisations like IGF and the World Bank

from the launch event? Some of the

in the room is that they are deeply involved

concerns raised by the audience included

in the process of advising countries on how

job losses and abandoned mines where

to construct appropriate regulatory regimes

ownership remains ambiguous.

for closure, or how they may think about building internal capacity within some of the

AD: I think on job losses, that is where

institutions of government for closure.

the social transitioning dimension is so important. It’s crucial to think about that

That’s why we see them as important

much earlier in the process and on an

stakeholders when it comes to having

ongoing basis, so you don’t find yourself

effective counterparts in government, who

in a situation where a host community is

can help towards the collaborative solutions

completely unprepared for the consequence

we have highlighted in this updated good

of closure.

practice guidance. The issue around the importance of partnerships also came to the

The question of orphaned and abandoned

fore during the conversations at the launch

mine sites remains a huge issue for the

event.

industry, particularly with regards to its relationship with society. Firstly, by demonstrating that we can responsibly close

Resource Global Network AD: This year marks the beginning of our next three-year strategy cycle. There are two thematic areas of focus for the next year and the next three-year strategy. One is

Aidan Davy chief operating officer ICMM

around what we call inspiring and enabling leadership. That is based on building out the sustainable development framework through the roll-out of the performance expectations I mentioned.

It’s also about engaging stakeholders to ensure we keep abreast of society’s expectations of the industry. There is an important collaborative piece there, whether it’s with our association members and partners to inform external policy debates, but also to work on the challenges. That might be in the space of closure, water or any

sites, we can underscore the validity of the

other issues we will deal with.

narrative that this is a legacy of a bygone era and we have moved on.

The last piece is a focus on strengthening operational practices. Whether that’s in areas

That still leaves unanswered the question

relating to biodiversity, climate, energy, water

of how to deal with those abandoned mine

or human rights and community relations on

sites. Our line as ICMM has consistently been

the social side. All those remain important for

that this is a challenge for governments

the industry.

and international institutions to take leadership on. But, to an extent we can play a supporting role by helping to leverage the involvement of the private sector.

JAW: What areas will ICMM be focusing on in 2019 and what can we expect from the organisation over the year?

a j

57

Building a Multi-Asset Mid-Tier West African Gold Producer

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“It was a pleasure working with the RGN team. The entire process - from the initial interview to the layout and finished piece - was seamless and professional. ” Orlee Wertheim Head of Business Development, Global Mining, Toronto Stock Exchange TSX Venture Exchange

60

COLUMNS | Thomas Hillig

SUSTAINABLE DEVELO

Renewables help African miners red

Resource Global Network

OPMENT IN AFRICAN MINING

duce their carbon footprint, by Thomas Hillig – managing director, THEnergy

61

COLUMNS||Ian Thomas Thomson Hillig 62 COLUMNS

Mining companies are increasingly discovering the advantages of solar and wind energy solutions.

While this development was initially triggered by projects in Northern Canada, South America, and Australia, in the past two years renewables have gained importance in African mining. Particularly, solar-diesel hybrid projects which have jumped on the bandwagon of success.

Cheap solar power reduces diesel consumption in solardiesel hybrid projects Many mining operations in remote locations that are not connected to the grid rely on electricity from diesel gensets (or heavy fuel oil generators). Electricity generation from diesel is traditionally extremely expensive, while wind and solar are competitive and can reduce the energy costs of mining companies

The renewable energy revolution has arrived

considerably.

at mines in Africa

In hybrid-solutions, diesel gensets are still a

In 2012, the first solar project at an African

viable power source for balancing load shifts

mine was conducted by Solea at Cronimet’s

and for generating additional electricity at

South African Thabazimbi open pit chromium

night or when clouds decrease the solar

mine, in Limpopo. With a 1MW solar capacity

output. The equation is that cheap renewable

it is a relatively small project. In the last years,

energy replaces expensive electricity from

several new solar plants have followed:

diesel.

ResourceGlobal GlobalNetwork Network 63 Resource

THOMAS HILLIG

•

SNIM: 3MW solar in Mauritania

•

SNIM: 4.4MW wind in Mauritania

•

Shanta Gold: 0.7MW solar in Tanzania

•

Iamgold: 15MW solar in Burkina Faso

•

Nevsun: 7MW solar in Eritrea

•

B2Gold: 7MW solar in Namibia

•

Venice Mine Complex: 0.5MW solar in

Zimbabwe

Recently, Resolute Mining and Ignite Energy

Thomas Hillig is the founder and managing director of THEnergy, a boutique consultancy established in 2013 focusing on microgrids/mini-grids and off-grid renewable energy.

For industrial companies, THEnergy develops energy concepts and shows how to become more sustainable – combining experience from conventional and renewable energy with industry knowledge in consulting.

THEnergy also advises investors and energy companies regarding renewable energy opportunities in rapidly changing markets. The initial focus was on commercial and industrial off-grid renewable energy projects, for example in mining, hospitality, telecommunications or on islands.

Driven by investor needs, corporate PPAs, rural electrification and energy access have become additional consulting focuses. THEnergy has led several large-scale due diligence processes in rural electrification.

COLUMNS | Thomas Hillig

64

ha

Projects signed an agreement for the

•

Copperbelt Energy: 1MW solar for

development of a 40MW independent solar

several mines in Zambia

hybrid power plant at the Syama gold mine, in Mali. The project would not only be bigger

Many mining companies are interested

than the other hybrid-projects, but it would

to fulfill parts of their sustainability

also include battery storage technology which

requirements through corporate power

allows for integrating a higher share of clean

purchase agreements (PPAs). However, in

energy into the system.

many African countries – such as South Africa – the regulatory framework does not exist

In hybrid-systems without energy storage, renewables typically do not contribute to more than 15-20% of the total energy generation.

Grid-connected renewable energy projects for mines in Africa

yet.

Reasons for the new success of renewables at African mines Several factors contribute to the increasing demand of African mines for renewables – especially for hybrid-solutions. In the beginning, mining companies had

There are also several grid-connected

serious doubts regarding the reliability of

renewable energy plants in Africa that supply

renewables.

electricity to mines: Various prototypes, some of them subsidised, •

OCP: 50.6MW wind energy in Morocco some with and some without battery storage,

(more than 95% of Phosboucraa mine’s have proven the concept of combining solar

power is provided through Foum El

or wind with fossil power sources. In addition,

Oued wind farm)

brands known from conventional energy

ResourceGlobal GlobalNetwork Network 65 Resource

”Declining prices for renewables and energy storage ave improved the business case for mines considerably.

Miners also see that the advantages of renewables go beyond pure cost savings in that they could generate positive publicity” Thomas Hilling, managing director, THEnergy

such as Caterpillar, Cummins, Aggreko,

the necessity of tailor-made solutions for

Wärtsilä, and ABB – that are active in hybrid

individual mines.

markets – increase the trust in renewable energy off-grid solutions.

Renewable energy players have realised that many miners are not willing to invest their

Declining prices for renewables and energy

own capital or to commit to long-term power

storage have improved the business case

purchase agreements (PPAs) that correspond

for mines considerably. Mines also feel

to the physical lifetime of solar or wind

more comfortable entering long-term

assets.

commitments of 10 years or more.

The formation of financing solutions for Mining companies see that the advantages

relatively short-term PPAs was crucial. This

of renewables go beyond pure cost savings

also calls for the emergence of a plan B in

in that they could generate positive publicity

case that PPAs are terminated earlier or are

and also position them as progressive toward

not prolonged as expected.

investors.

Solar companies in particular dedicate Internally, renewables have turned out to

resources for making solar plants more

be an attractive platform for ambitious

flexible through semi-mobility concepts that

employees to qualify for further management facilitate their dismantling and redeployment challenges.

at different locations.

Maybe even more important are the lessons

Finally, renewable energy players have

learned on the part of the renewable

started to apply modern sales and marketing

companies. They started to speak the

tools to spread the message to mining

language of miners and to understand

decision makers.

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COLUMNS | Thomas Hillig

Renewable energy only one piece of the sustainable mining puzzle

Energy efficiency measures can be applied all along the mining value chain as well as for auxiliary applications. The main fields are: compressed air systems, ventilation, material

Renewable energy is an important part

handling, pumping, crushing and milling.

of sustainable mining, but definitely

Energy efficiency can account for electricity

not everything that is required. Energy

reductions of 5–20% and load shifting for

efficiency measures also play an important

energy cost savings of 5-10%.

role, especially as the renewable energy penetration in hybrid-mining projects

Energy efficiency measures and load shifting

typically is still rather low.

schemes have a direct influence on the

Resource Global Network

Electrification of mines As renewables play a more important role in mining and falling energy storage prices lead to higher renewable energy penetration rates it is important to mention, that mines normally have significant energy consumption beyond electricity.

Electrification of mining vehicles could significantly contribute to make mines more sustainable. Electric battery or cableconnected mining vehicles could be used in open-pit, but also in underground mining.

Outlook Renewables for African mines are still in an early phase of their development, but it can be expected that in the next years, dozens of new renewable energy projects will be implemented at mines in Africa probably not only hybrid projects, but also solar and wind projects for grid-connected mines that want to source renewable energy through PPAs. Legislation changes that are expected for South Africa might boost this development. optimal design of the PV plant. Avoided or shifted energy consumption allows for designing the PV plant in an optimal way.

Often the integrated solution decreases the amount of capital expenditure needed for upgrading existing diesel gensets with solar power considerably.

a j

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68

COLUMNS | Julia Baxter

SMART DEVEL

Resource Global Network

LOPMENT, SMART BUSINESS The growing concept of shared value in the mining sector, by Julia Baxter

69

COLUMNS||Ian Julia Thomson Baxter 70 COLUMNS

Mining companies operate in some of the most undeveloped regions in the world, often with major economic and social needs.

In countries where mining is the primary economic activity there is increasing pressure on companies to contribute meaningfully to development. This coupled with the billions lost by mining companies as a result of community conflict has fuelled industry efforts to find better ways to form robust stakeholder relationships and provide development benefits beyond royalties and taxes.

The concept of ‘shared value’ - the creation of economic value in a way that also creates social value – was first conceived in 2013 and has been simmering in the industry for some

In mining, shared value can mean enabling

time. Different to traditional Corporate Social

local cluster development, improving

Responsibility, which is underpinned by the

available local skills and services, and

principle of giving back and often described

supporting institutions in the countries and

in terms of funds or time committed, shared

communities where a company operates,

value is about finding opportunities for

ultimately boosting corporate and national

innovation and competitive advantage to

productivity and growth. The creation of

solve development issues, maximising both

regional or local clusters, for example, that

the economic and social returns.

ensure distribution of economic and social benefits, beyond the mine, through economic

ResourceGlobal GlobalNetwork Network 71 Resource

JULIA BAXTER

diversification and an investment in shared infrastructure and logistics can also deliver opportunities for cost and time savings within the mine and a reduced risk of social conflict.

However, despite relatively wide recognition of the merits of shared value and some early initiatives, translating the theory into action has proven difficult. Fundamental to the implementation of shared value is

Julia is a strategic communications and stakeholder engagement expert. She is experienced at advising industry executives and ministers to identify opportunity, manage risk and overcome highly sensitive strategic challenges in the mining sector. Latterly she has advised on these areas for several multinational mining companies and public institutions including the Ministry of Mines Malawi, Ministry of Mining Kenya, and the Extractive Industries Transparency Initiative (EITI) Secretariat in Mongolia. Julia is responsible for Adam Smith International’s mining and energy portfolio and has led programmes on behalf of the World Bank, DFID and the Australian Government. Julia holds an MSc in Global Governance and Ethics from University College London (UCL) and an MBA in International Mineral Resource Management from the Centre for Energy, Petroleum and Mineral Law and Policy (CEPMLP), University of Dundee.

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COLUMNS | Julia Baxter

the integration of its central principles into

The partnership tango

business strategy. Whilst some companies

Over the past decade strategic partnerships

are more progressive in this regard than

have been identified as innovative

others, across the global mining industry

models to generate greater social and

companies have yet to adopt ‘development’

economic returns, and meaningfully deliver

as a core competence and business priority.

shared value. An integrated approach to development will deliver developmental

As a result, product, process or critical path

impact more reliably than any single

decisions are still mostly made without

intervention. Independent social investments

consideration of their impact on social and

may achieve a ‘social licence to operate’ but

economic development. Instead, impact is

are unlikely to deliver long-term, sustainable

managed once a decision has been made,

benefits, unlike a collaborative approach.

missing the opportunity to make those decisions on products, processes or critical

Delivering on a shared value agenda is

path in ways that are consistent with positive

highly complex, and involves a web of

impact for both the company and society.

stakeholders, both public and private.

Local clusters, for example, often cross

ResourceGlobal GlobalNetwork Network 73 Resource

communities, sectors, companies and involve

alliance have primarily included perceived

several types of investment in infrastructure

diverging agendas and the absence of a

and other. A local cluster depends on a

relationship built on trust; misperceptions

coalition of members with different priorities

and prejudices too often prevail. Each party

and different skillsets, but with the same

- government, civil society and industry -

overarching goal. This type of joined up

assumes the other parties are pursuing a

effort is more likely to generate wide positive

conflicting agenda and are an obstacle to

impact at the community and regional level,

pursuing its own goals. Partnerships for

helping each partner to achieve goals they

development in the mining industry are

could not hope to achieve on their own. A

particularly complex due to the industry’s

shared objective allows each partner to take

specific risks, potential value and the emotive

a role within their organisational remit, and

and direct impact it is likely to have on its

one that is best aligned with their knowledge

host communities.

and skills.

The rules of engagement

Long-term partnerships are tricky however.

An integral component of a partnership

Some of the barriers to fostering an effective

approach for shared value is an acceptance

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COLUMNS | Julia Baxter

by all partners of the shared value principles.

partnership and how the outcome changes

That is, an agreement that each partner will

with or without the partnership.

benefit from participation in the partnership and that these benefits are embraced.

The type, members or complexity of a

Shared value is not a trade-off between

coalition may look different at the different

company benefit and development impact,

stages of a mining project and therefore

but instead an alignment with the strategic

those that employ a systematic approach to

objectives of each partner.

action are likely to be more effective.

context, initiative and members, but there

Smart development is smart business

are some broad characteristics that define

The shared value conversation is

any coalition. These include voluntary

undoubtedly moving forward, with

participation of each member; a common

organisations like the ICMM and the

vision and agreed set of rules and objectives;

Development Partner Institute leading the

clear and complementary roles and

way, reframing the role of the mining sector

responsibilities and agreed upon boundaries

and its role in a country’s development

to the partnership; and a common awareness

journey. Opportunities to involve the mining

(and articulation) of the ‘value add’ of the

industry in national or regional dialogues

Every partnership will be unique to its

Resource Global Network

help to increase awareness within the

strategies to contribute to the development

industry of the role it plays, provoke a sense

of mining communities, but social pressure

of shared ownership and accountability and

and corporate best practice are pushing

open ideas on how companies can shape

industry standards further on.

their activities to deliver greater shared value.

The Partnership Approach – under the As this year’s Investing in African Mining

right conditions – could be a means by

Indaba highlighted, sustainable business will

which shared value can be successful and

continue to support sustainable development

maximised, utilising complementary skills

outcomes, and vice versa, in an industry

and experiences to get it right from the

where we see increasing expectation, risk

beginning.

and global attention.

Modelled by some of the world’s leading miners, the industry has adopted evolving

a bj

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76

COLUMNS | Michael Cronwright

A NEW ENERGY

Considering Africa’s bright prosp

Resource Global Network

Y IN AFRICAN EXPLORATION

pects in the booming critical materials mining space by Michael Cronwright

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COLUMNS||Ian Michael Thomson Cronwright 78 COLUMNS

A lot of the recent activity in the exploration industry in Africa is driven by the global adoption of alternative energy generation and storage technologies, with a particular focus on lithium, cobalt, tantalum, tin, vanadium, and nickel.

As a result, I have had the privilege of working on some interesting lithium, tin and tantalum deposits like Manono, Rubicon/Helikon and Kamativi and visited many of the pegmatite belts in Africa including those in Mozambique, Namibia, Zimbabwe, Uganda, Rwanda, Burundi and South Africa.

Critical materials (which include the critical metals) are materials considered particularly

These metals cannot readily be substituted

important in the technology industry and

and are seen as having strategic value by

emerging innovations, amongst other

governments and industries that are focused

industries, and defined on the basis of

on de-carbonising the energy sector and

their economic importance and supply risk.

maintaining their technological edge.

Technologies include smart devices, wind turbines, LED lights, electric vehicles, power

The recent correction in the lithium

generation and off-grid storage, all of which

carbonate prices, to around US$12,000-

require metals such as tin, tantalum, rare-

15,000 per tonne (p/t), from the heady levels

earth metals, lithium, cobalt, vanadium and

earlier in the year at around $20,000 p/t,

nickel.

is still well above the long-term average of around $5,000-6,000 p/t from 2005-2015 and

ResourceGlobal GlobalNetwork Network 79 Resource

MICHAEL CRONWRIGHT Michael is the critical metals principal consultant at the MSA Group. He has 19 years’ experience in African geology and exploration across a variety of commodities and significant exploration project management experience.

$7,500 p/t in 2016. It comes as a timely reality check to those companies with small subeconomic projects in challenging jurisdictions, and a reminder that commodities’ high prices at times are not sustainable and often revert back to their long-term averages; in those cases, only the projects on the lower end of the cost curve make it.

What is indisputable, however, is that there is a definite trend of all major motor manufacturers committing to EV technologies

He is a QP/CP in lithium, tin and columbo-tantalite. Michael has a M.Sc. in Exploration Geology from Rhodes University with a dissertation reviewing the pegmatites of the Alto Ligonha Pegamatite Province in Northern Mozambique.

He started his career at the Council for Geoscience in 1999 where he was involved in World Bank mapping projects in Mozambique and Madagascar. In 2006 he moved into the geological consulting industry and since 2013 has been with The MSA Group.

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COLUMNS | Michael Cronwright

”Africa’s track record in the g to be sniffed at with Zimba lithi

critical m

in some form or other and governments

with predictions of supply shortfalls are

committing to green technologies. Many

driving a search for new lithium, tin, cobalt

governments and major cities have

and nickel resources in Africa (and the rest of

announced ‘bans’ on diesel and internal

the world).

combustion vehicles, some starting as early as 2025. Despite these not being legislated it

Many of the historic pegmatite belts

does demonstrate a move to a greener future known for their tin, beryl and tantalum and cleaning up the pollution that plagues

mineralisation are being revisited for their

cities like Mexico City, Paris and London.

lithium potential by junior exploration companies from London, Toronto and Perth.

Beijing has already started the process with

Africa’s track record in the global lithium

the electrification of its public transport

market is not to be sniffed at with Zimbabwe

system. In Norway over 50% of new car sales

being the 5th largest lithium producer in

in 2017 were electric. The current demand

the world with all production from the

and forecasted increase in demand together

Bikita Mine in the form of petalite for the

ResourceGlobal GlobalNetwork Network 81 Resource

global lithium market is not abwe being the 5th largest ium producer in the world” Michael Cronwright, metals principal consultant

for the Chinese market and is also looking at producing lithium carbonate in country rather than exporting a mineral concentrate.

This is a trend we’ll probably be seeing a lot more of particularly with some of the more isolated projects with access to power.

MSA is also seeing many junior exploration companies getting involved in projects with the view to be able to produce in the short term and provide returns to their shareholders. They are probably better described as junior miners.

There are numerous other lithium projects through Africa including the old tin mines at Kamativi and Manono, the pegmatites of the Alto Ligonha Pegmatite Province in Mozambique, the Northern Cape pegmatites, the pegmatite belts in Ghana, Nigeria, and Cote d’Ivoire. Many of the Chinese lithium convertors have also taken positions in many of these projects.

ceramic and glass market and now looking at producing spodumene concentrate for the

Juniors are also looking into the reprocessing

battery market.

of old tailings dumps, examples being the lithium-bearing tailings at Kamativi and Uis.

Consequently, Zimbabwe has seen a lot of

Slag and waste dumps are also being looked

activity with many juniors taking positions

at for nickel, cobalt and ferrochrome. Some

over the old beryl and tantalum mines in the

of these projects will require innovative

Archaean greenstone belts with Prospect

approaches to their success but represent

Resources’ Arcadia lithium project being

some of the low hanging fruit in the industry

the most advanced exploration project at

if executed successfully.

the moment, looking at producing lithium carbonate within Zimbabwe. Desert Lion

Another important consideration for many

Energy’s lithium project at the old Rubicon

exploration and mining companies is the

and Helikon mines in Namibia has recently

production of by-products such as feldspar

produced lepidolite concentrate destined

or tin and tantalite concentrates from the

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COLUMNS | Michael Cronwright

lithium deposits, similarly some of the tin and

However, with concerns over ethical sourcing

tantalite projects like Afritin’s Uis Tin Mine,

of cobalt, tin and tantalum, many juniors,

focused on the hard rock, could potentially

miners and technology companies are

produce lithium concentrate as a by-product.

looking at innovations through blockchain technologies to ensure ethical sourcing or

Other commodities in the spotlight with the

looking at replacing the cobalt with nickel

green energy boom include cobalt, nickel

dominant cathode technologies (which Tesla

and vanadium which have seen a significant

is currently in the process of doing).

rise in price over the last 12 months. Cobalt in particular is used by Tesla and Apple

Recent bans on cobalt concentrate exports

in their battery cathode technologies and

from Glencore’s Katanga Mine, in the DRC,

has attracted a lot of interest from juniors.

due to high uranium content further adds to

Resource Global Network can leverage off this and play a bigger role in the value adds to its mineral endowment.

With the bubbles of the recent past fresh in the minds of many explorationists, backing the right project is critical; the ability to flip projects is not as simple as it was in the past with investors being spoilt for choice and a lot more discerning and commodity agnostic.

In my opinion the junior exploration company mentality is slowly being replaced by that of a junior miner with a more medium to long term view on projects with a view to actually being a producer. A good project isn’t always about being bigger and/or higher grade. It is about having the right management team that can think outside the box in terms of fast tracking and de-risking projects, applying new technologies in the exploration process and understanding the processing aspects and potential product unique to the project early on.

One example is the application of geometallurgy, which has been the buzzword the woes of cobalt producers and explorers

for the last decade or so, with many

and raises question marks on the security

companies now realising that the improved

of supply. There has thus been a focus on

understanding of the mineralogy, mineral

identifying new sources of these metals

textures, and deleterious elements is needed

outside the traditional mining jurisdictions

to determine if a project will be able to

and also a focus on metals like nickel.

produce a saleable product at a lower cost compared to other projects.

What remains to be seen is whether Africa

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MINING | Bushveld Minerals

BUSHVELD MINERALS

The vertically integrated primary vanadium producer

Resource Global Network

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The rapid rise of Bushveld Minerals in the global mineral development space has been a remarkable sight to behold, given that it has developed into one of only three operational primary vanadium producers in the world despite only being incorporated in January 2012.

Two months later Bushveld was listed on London’s AIM as a mineral development company focused on exploring and developing projects in South Africa’s Bushveld Complex.

Today the company owns three high grade vanadium assets, one already in production and two under development, which provide a total resource base of 440 million tonnes (Mt). Bushveld currently supplies around 3,000 Mt of vanadium from its Vametco mine - representing 3% of the global vanadium market. With expansion plans underway at Vametco plus targeted brownfield opportunities, Bushveld aims to expand its Group production to 10,000 Mt in the medium term.

The company consists of two flagship platforms: Bushveld Vanadium and Bushveld Energy. The former is a growing, low cost,

Resource Global Network vertically integrated primary producer which manages the three vanadium assets in the Bushveld Complex.

The latter is a leading energy storage project developer and component manufacturer, exclusively focused on Vanadium Redox Flow Batteries (VRFB) technology. “Bushveld Energy was accordingly launched in 2016, to capture a share of this attractive market,” says Bushveld’s CEO Fortune Mojapelo.

“Bushveld Energy’s business model envisages activities along the VRFB value chain and will include an electrolyte capacity in South Africa, a VRFB assembly and manufacturing as well as an energy storage project development.”

The best performing commodity Without a doubt, vanadium has been the front runner of the commodity price market in recent years, surging by more than 365% in the last three years from US$18.6 per kg of vanadium to US$81.2 per kg in 2018.

Mojapelo explains that this astronomical price increase in vanadium has been driven by a fundamental supply deficit in the vanadium market, arising from growing demand underwritten from the steel sector, which accounts for around 90% of vanadium consumption.

“The steel market is set to continue supporting robust vanadium demand,

Fortune Mojapelo, Bushveld Minerals CEO

which is expected to grow at a CAGR of approximately 2% over the next 10 years,

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MINING | Bushveld Minerals

supported by the increased intensity in use

“The market share of VRFBs compared

of steel in emerging markets, particularly

to other energy storage technologies is a

in China, underpinned by the improved

key assumption,” states Mojapelo. “Recent

enforcement of regulations.”

trends to revise energy storage forecasts upward imply that vanadium demand from

Therefore, Bushveld believes that the current

VRFBs may be greater than expected, even

vanadium price and supply/demand gap

under ‘aggressive forecasts’. Within 10 years,

suggests that there is sufficient incentive

demand for vanadium by energy storage

to stimulate new production from existing

could equate to 50-100% of today’s global

primary producers, which is exactly what the

market.

company plans to do in the near term.

“The current market dynamics point to a Bushveld’s unique position as one of three

positive price outlook, underpinned by a

operational primary vanadium producers,

growing deficit which we believe can only be

and one of only two vanadium-focused pure

closed by existing quality primary vanadium

play companies, will also allow the company

producers like Bushveld Minerals, who are in

to leverage its large low cost production base

a position to scale up production.”

and be a catalyst in the emerging energy storage industry.

Resource Global Network

The resource base

adjacent to Vametco. “The mineralisation

The Vametco Mine in Brits, North West

is outcropping and a continuation of the

Province is a low cost vanadium mine with

Vametco deposit strike with similar or higher

a 142.4 Mt resource that also produces a

vanadium grades,” Mojapelo reports.

trademark vanadium product, Nitrovan® as well as modified vanadium oxide (MVO).

Recent drilling results have indicated vanadium grades in magnetite of 1.54 - 2.09%

Bushveld increased its controlling interest

vanadium pentoxide, again similar to the

in Vametco to 74% in September 2018

mineralisation seen at the Vametco Mine.

through a series of transactions, having first

Therefore, Bushveld expects Brits to support

invested in the operation in April 2017. The

Vametco or other brownfield facilities when

firm recently commenced an operational

it comes online, but first the company must

transformation programme to enhance

complete a mineral resource estimate that is

Vametco’s production efficiency.

scheduled for Q1 2019.

Another key part of this ambitious medium-

The Mokopane Vanadium Project is the

term production target is the development of

final component of Bushveld’s vanadium

the Brits Vanadium Project, which comprises

triumvirate and happens to be one of the

prospecting rights on several farms

world’s largest primary vanadium resources,

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Resource Global Network

“The current market dynamics point to a positive price outlook, underpinned by a growing deficit which we believe can only be closed by existing quality primary vanadium producers like Bushveld Minerals, who are in a position to scale up production.”

Fortune Mojapelo, CEO Bushveld Minerals Mt reserves and high in-situ (1.4%) and in-

The next generation of energy storage

concentrate (1.75%) vanadium pentoxide

The formation of Bushveld Energy and

grades.

Bushveld’s subsequent entry into the VRFB

with a 298 Mt JORC resource including 28.5

sector was intended to position the company A positive pre-feasibility study was completed

at the vanguard of the next generation of

back in January 2016 which indicated a

energy storage technology.

25% IRR, $300 million capex and a 5,500 Mt per annum production rate. The intention

“The company believes that VRFBs are well

remains to secure a new order mining

positioned to take a significant share of the

right and either develop Mokopane into

global utility-scale energy storage market,

a vanadium mine and processing plant or

where their distinctive features, including

supply ore from the project to plants in China

low life-of-battery costs, 20-year life without

and/or elsewhere in the world.

performance degradation, flexible scalability, long duration energy storage capacity and

Bushveld’s target is to grow its production

inherent safety give them a significant

platform from the current levels of

advantage over other technologies.”

approximately 3,000 Mt of vanadium to 10,000 in the medium term. The company’s

VRFB technology combines the performance

assets are positioned in first to second

advantages of flow batteries with the

quartile cost curve position. Bushveld aims to

simplicity of using just one natural element

keep reducing costs and be cash generative

– vanadium. Flow batteries use a liquid

throughout the cycle.

electrolyte to store energy, this allows for near unlimited recharging (or cycling), easy scaling by just adding more electrolyte and negligible performance deterioration over long periods of time.

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Resource Global Network As a result, for daily energy storage of a few hours or more, flow batteries provide the most cost-effective means to store energy.

The advantage of vanadium, lies in its ability to exist in four different oxidation states and its water-solubility, allowing for a simpler battery with fewer inputs and no flammable elements.

Having said that, Mojapelo points out that the most common question about VRFBs is how they compare to lithium-ion battery technology. “There is no clear superiority, with use cases and site requirements often determining the optimal solution. VRFBs and Lithium-ion are non-competing technologies,” he says.

“Nonetheless, Bushveld has seen the global deployment of VRFBs increase year-on-year and has made significant progress defining the energy storage market opportunity, building industry awareness for VRFB and developing a business model for Bushveld Energy.

“The business model is anchored in Bushveld Minerals’ low-cost production platform and smart partnerships along the VRFB value chain.” One such relationship is with UniEnergy Technologies (UET), a US-based manufacturer of turn-key, large and mediumscale energy storage systems for utility, micro-grid, commercial, industrial and other applications.

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The future of Bushveld Minerals Taking into consideration the sky-high

electrolyte. The electrolyte is sold to VRFB companies or direct users/buyers of VRFB systems.”

potential of the VRFB technology industry, Bushveld Energy is set to take up a larger

Mojapelo also highlights Bushveld Energy’s

role in the wider Bushveld story, as vertical

role in developing the energy storage value

growth opportunities multiply across the

chain in South Africa through the application

Bushveld Energy division.

of South Africa-mined and beneficiated vanadium in VRFBs.

“A key part of Bushveld Energy’s strategy is the creation of an electrolyte production

“As a leading primary vanadium producer

facility which Bushveld Energy is establishing

and exporter, South Africa serves as the

with the IDC. The electrolyte manufacturing

logical base for VRFB manufacturing.

will include building and operating a

This includes multiple steps of mineral

chemicals plant that purifies vanadium

beneficiation, including converting vanadium

feedstock and converts it into a liquid

into electrolyte and assembling VRFBs locally.

Resource Global Network

“We are convinced that significant demand

acquisition opportunities to build a 10,000

will come from Africa and for similar logic to

Mt production platform in the Bushveld

locating electrolyte production here in South

Complex, along with exciting opportunities in

Africa. Especially in the South African market,

the lively VRFB technology sector.

local content plays a key determining factor and we believe that no battery technology

This growth plan provides a sound basis

can come close to competing with VRFBs on

for the company to develop into one of the

this criterion in South Africa.�

largest, lowest cost, vertically integrated primary vanadium producing companies and

Overall, Bushveld Minerals is advancing a

one of the most influential organs of South

significant horizontal and vertical growth

Africa’s emerging energy storage industry.

plan, incorporating brownfield expansion and

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MINING | Prospect Resources

PROSPECT RESOURCES

Glittering prospects for this miner in the African lithium space

Resource Global Network

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MINING | Prospect Resources

In late 2018, ASX-listed Prospect Resources (Prospect) published a definitive feasibility study (DFS) for its Arcadia Lithium Project in Zimbabwe, a vital step for the company as it works towards near term production from one of the most significant lithium projects in the world.

The DFS confirmed technical and financial viability of the 2.4 million tonnes per annum (Mtpa) plant throughput development and forecasted an average annual production of 212,000 tpa of 6% spodumene concentrates, 216,000 tpa of petalite concentrates and 188,000 lbspa of tantalum over a 12-year mine life. While these production figures convincingly indicate the true potential of the project, the strong economics outlined in the DFS have been most pleasing to Prospect’s managing director Sam Hosack.

“The DFS indicated a robust business model capable of supporting quite a lot of potential turbulence in the market,” says Hosack.

“When you are busy building a DFS you set out to anticipate the business environment variability to ensure the business robustness is factored in.

Zimb

babwe President Emmerson Mnangagwa at Arcadia’s groundbreaking ceremony

Resource Global Network “In a sense you want the project to remain competitive in the most trying circumstances and in this case, it has been very rewarding to know that the Arcadia project is in the lowest capex quartile. That has been a major win for us.�

Capital costs for developing the project are estimated at US$165 million, with operating costs coming in at $285 per tonne for a conventional open pit mining scenario at a LOM strip ratio of 3:1.

Meanwhile, average annual EBITDA has been forecasted at $106 million, contributing to life of mine revenue of $2.93 billion, excluding tantalum credits.

Having been granted a mining lease by the Zimbabwean government in August 2018, and with transport infrastructure already in place at the site which is located just 38 km from capital city Harare, Prospect is fantastically positioned to deliver shareholder returns as it moves from developer to operator at Arcadia.

Returning shareholder value While the Prospect directors and management have known of the potential value held within the Arcadia project for some time, this belief was corroborated by the Hunter Capital Advisors report, which identified Arcadia as a Tier 1 asset in the global lithium space. This validation through independent research has been very comforting to Prospect.

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MINING | Prospect Resources

The report went on to say: “The Arcadia

for any informed investor. We’ve taken a

project keeps standing out as a large

conservative position and have still delivered

tonnage, relatively high grade project

a very robust DFS.”

amenable to open pit mining with a modest capital expenditure required to produce

Furthermore, Hunter Capital’s risk adjusted

lithium concentrates.”

valuation concluded that as it delivers on its strategy, Prospect should experience

“I think it [the external report] serves as

a significant value uplift, towards a price

additional validation of the work performed,

target of AUS$0.14, resulting in a market

and potential identified in the DFS.” says

capitalisation of $304 million. Prospect’s

Hosack. “Projects like this are on a journey

market cap at the time of writing was $45

and what we need to do is communicate

million.

successfully to all of our stakeholders that this project can stand up and stand out.

“Returning shareholder value is our purpose, there is no disputing that. However, the

“It is one thing to have an internal belief, and

journey to delivering shareholder value

there is certainly no lack of internal belief,

requires some sophistication. In essence, we

but we are also very confident that what we

feel that full shareholder value comes when

have displayed in the DFS shows impartiality

we as a business expose ourselves to the

Resource Global Network

upside of the lithium/EV cycle whilst being

The spectacle was a clear demonstration of

well underpinned by demand from the more

the high levels of cooperation between the

stable glass and ceramics market.

public and the private sector in Zimbabwe, as the nation looks to attract investment

“I think our shareholders will get successful

and instigate an economic revival after years

returns as we deliver on our ambitions and

of neglect under former President Robert

the lithium/EV story realises its full potential.”

Mugabe.

Zimbabwe is open for business

“We perceive Zimbabweans as being prepared and ready to make the difficult

The end of 2018 also brought another key

steps forward to recover from the economic

milestone for Prospect when the official

stagnation of the last 15 years,” says Hosack.

groundbreaking ceremony took place for the

“That’s not going to happen just off the back

Arcadia project in December. The ceremony

of government ambition. It will require lots

was opened by the President of Zimbabwe

of fresh investment in conjunction with

Emmerson Mnangagwa and attended by

government economic framework.

various ministers, Australian and Chinese ambassadors and key stakeholders.

“I think we have timed our entry well. We’ve successfully convinced the government of

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MINING | Prospect Resources

the value of this project and managed to

The RRI was conceived by President

gain vital social and stakeholder support that

Mnangagwa in an effort to loosen the

provides us the social licence to operate.

statutory and regulatory burden than newcomers like Prospect are faced with in

“The key message from the groundbreaking

Zimbabwe. The initiative is essentially an

was that we have laid the foundations in

open forum where the investor presents a

the appropriate fashion and have been

timeline of work from which the President’s

recognised as a committed investor in

office can provide direct support to.

Zimbabwe by the government.”

This system allows for transparent dialogue The government also reaffirmed its

between both parties and for Prospect it

commitment to comprehensive reforms to

provides a direct line to the President’s office.

enhance Zimbabwe’s competitiveness and to

“The fact that the President is prepared

attract foreign investors. One example of a

to apply himself and his office through

recent reform Prospect has taken advantage

the initiative shows the government’s

of is the Rapid Results Initiative (RRI).

commitment to expeditiously dealing with our applications and that of our peers.”

ResourceGlobal GlobalNetwork Network 103 Resource

A mining sector with high potential

Nonetheless, new evidence suggests that the tide may be beginning to turn. The 2018

Though the investment drive under President Mining Business Confidence Index (MBCI) Mnangagwa is in full swing, the challenge

found that executives and investors were

of turning around Zimbabwe’s economy is

bullish about the prospects of the mining

substantial, and the mining sector is likely

sector, as shown by the overall MBCI of +21.9,

to play a major role in any recovery, with

compared to -6.6 in 2017.

around 800 mines currently in operation.

Prospect is a clear example of an investor However, these mines have only performed

with a renewed sense of confidence

at around 10% of their US$18 billion per

in Zimbabwe’s mining sector, which is

annum potential since 2009, delivering

evidenced by the firm’s strong commitment

just $2 million in annual revenue as the

to developing exclusively in-country.

national economy faltered and the mining sector became bogged down in legislative

“We currently employ over 100 people in-

bottlenecks.

country, though we do have an executive

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MINING | Prospect Resources

office in Perth,” Hosack reveals. “Then, during

400 people from direct employment and

the construction phase of the project, there

obviously you can multiply this to establish

is likely to be in the order of 1,000 different

indirect employment too.”

skills demanded.

Hosack is also acutely aware of Prospect’s “As the project goes through its cycle, tasks

social responsibility in Zimbabwe, particularly

become more complex but we are comforted

with regards to community training

knowing that Zimbabwean skills can meet

programmes in key fields such as agriculture

our needs. Our final headcount during

and health. “By far the biggest impact we can

the operational phase will be around 300-

have is up-skilling the community that are

Resource Global Network

likely to be employed by us, ensuring they are

Versatile offtake options

healthy and fit for the rigors of the role, while

Zimbabwe is already the world’s fifth largest

developing skills that lead to sustainable

lithium producer and Minister of Mines

prosperity.

Winston Chitando recently stated his belief that the country has the potential to account

“We want to invest heavily into programmes

for 20% of global demand when all known

targeting these outcomes and see these as

lithium resources are being exploited.

preceding the project. So far we have been meticulous in our planning.”

With this in mind, Prospect is determined to be a frontrunner in Zimbabwe’s lithium

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MINING | Prospect Resources

Resource Global Network space, particularly as the EV story gains pace.

However, the company is not just targeting the lithium battery chemicals space. “The competitive advantage that we want to leverage off is the suitability of our product across multiple markets, including ceramics which absorbs around 30% of global lithium production.�

This type of arrangement would allow Prospect to take advantage of established and robust markets such as ceramics and glazing, while also exposing itself to the more exciting and contemporary battery minerals sector, as confirmed by its offtake agreement with Chinese battery metals expert Sinomine.

With a strong DFS under its belt, Prospect will plough forward with engineering, design and construction work in 2019, ahead of a commissioning date in 2020 for its Arcadia project. If the company keeps to this timeline, Prospect will become the largest lithium producer in Africa. Watch this space.

ASX:PSC

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WORKS HERE.

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MINING | Consolidated Nickel Mines

Resource Global Network

CONSOLIDATED NICKEL MINES Restarting the Munali Nickel Mine in Zambia

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MINING | Consolidated Nickel Mines

The Munali Nickel Mine in Zambia first came across the radar of Consolidated Nickel Mines (CNM) in 2014 when it was struggling in care and maintenance under Chinese owners Jinchuan Group. Sensing the opportunity to take on a high potential asset, CNM quickly began discussions with Jinchuan and signed a lease and royalty agreement to become owner operators of the mine for a 20year period. “In 2015 we had the deal financed through CE Mining - a British-based private equity fund,” says CEO Simon Purkiss.

“They put in funding to maintain the care and maintenance while we de-risked the project, as it had previously been saddled with high costs and other issues.” However, over the last four years CNM has transformed the fortunes of the mine and is poised to restart operations at Munali in the first quarter of 2019.

After taking over the mine, CNM conducted extensive evaluation and study work in order to put together a sustainable restart plan. First and foremost, the company revisited the geological foundations at Munali as the previous owners had used the wrong geological model, which contributed

Resource Global Network

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MINING | Consolidated Nickel Mines to uneconomic operations when the nickel price fell in 2008.

Re-designing the mine A new geological model was developed

by CNM along with the defining of a new JORC resource of 6 million tonnes at 1% nickel in 2015. Next, the company changed the mining method to suit its improved understanding of the geology at Munali.

“The previous owners were using longhole open stoping as the mining method, but we changed that to a cut and fill method. The deposit is 50 metres thick in some areas, with very good grades of up to 4% nickel on the footwall, so one of the things we wanted to ensure was that we got full extraction and grade control. The cut and fill process lends itself to those.”

This new mining method has resulted in a considerable reduction to operating costs at the site, making it more resilient to the lower nickel price environment of the last decade.

In fact, CNM has succeeded in bringing production costs down to around US$8,000 per tonne of nickel.

In October 2018, CNM announced it would soon be restarting operations at the Munali

The majority of the $40 million finance

mine after securing $30 million in financing

package was spent on new equipment such

from a Shanghai-listed mining firm called

as a DMS plant and a PGM concentrate

Chengtun Mining Group, who first invested

flotation circuit along with the refurbishment

in CNM five months earlier. CNM secured a

of the processing plant, Purkiss reveals. “The

further $10 million as an offtake loan with

plant had been standing for eight years and

Transamine who secured the offtake from

needed some repairs. We also needed to take

Munali for a four-year period.

the decline down another level to start the cut and fill going back upwards.”

Resource Global Network

Meanwhile, CNM welcomed three non-

“Chengtun have been very supportive

executive directors from Chengtun to the

partners and are focused on battery metals,

management team to accommodate its new

so they saw us as a key part of their battery

partnership with the Chinese firm. In recent

strategy. They took equity for $30 million,

years, Chengtun has developed expertise in

representing about 33% of the company.�

African mining and is close to completing a copper-cobalt refinery in the DRC.

CNM has also made sure it remains highly attuned to the rapidly developing battery

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metals market and has even conducted

March or April this year, so it’s a major step

preliminary test work on its nickel

forward for us.”

concentrate with the intention of potentially moving into nickel sulphate or metal

A ramp-up phase will follow later in the year

production.

and conclude in the third quarter, by which

First nickel production

point the facility will deliver 60,000 tonnes of ore per month. By the end of 2019, Munali

The first quarter of 2019 is set to be a

will have produced 25,000 tonnes of nickel

landmark period for CNM as it targets first

concentrate with 50,000 tonnes of nickel

nickel concentrate production from the

concentrate targeted for 2020 and onwards.

Munali mine. “This is a major development for us because we will finally move from a

CNM’s other key objective in early 2019

cash draining environment to a cash flow

centres on the construction of a dense media

positive environment.

separator (DMS) plant, which will become the first such facility built on Zambian soil. The

“Until now we have had to rely on raising

DMS plant will improve recoveries and head

funds to keep everything running and in care

grades from 1 to 2%, making it an invaluable

and maintenance. Our latest estimations

addition to the infrastructure at Munali.

show that we should be cash flow positive by

ResourceGlobal GlobalNetwork Network 117 Resource

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MINING | Consolidated Nickel Mines

“First nickel production is a major development for us because we two from yearsa ago will “About finally move cashthe draining environment to a cash flow idea was floated to pivot positive environment” – Simon Purkiss, CEO

from being an iron ore exporter to a local steel producer. The idea was that we would build a steel mill in front of the iron ore deposit.”

“I am actually looking at the DMS plant at

mines in the Copperbelt. In addition, we are

the moment, its quite a massive beast and is

introducing modern management reporting

pretty much on target for commissioning by

systems such as accounting package

the end of the year,” Purkiss reveals.

Acumatica and a fantastic reporting system, InPhase, that allows us to drill down into the

“Consulmet, the DMS team out of South Africa have also been great throughout their

data, again a first for Zambia.”

circuit. They’ve designed a very nice plant that

Corporate social responsibility

we will be commissioning very soon. Also, our

The Munali mine is located in a rural farming

shareholders CE Mining have been very quick

region of Zambia around 75km South of the

decision makers and possess strong mining

capital Lusaka. As a result, an unfortunate

credentials that we can draw from.

but necessary outcome was the relocation of

work on the DMS plant and PGM flotation

around 50 households from inside the mine “It is a busy time with a rapid ramp up of

area, equating to a community of 400-500

people and we are fortunate to have been

people.

able to recruit a very good team from the

Resource Global Network During the last two years of Munali being in

as possible, despite education levels being

care and maintenance, CNM built 50 new

fairly low throughout the rural region.

households around 23 km away from the

However, the firm hopes that the various

mine for the displaced communities, along

social development projects it has overseen

with a modern school for 500 pupils and a

across the region will help to improve levels

large rural health clinic.

of education over time. CNM also intends to eventually have a 100% Zambian nationals

“We also attempted to re-establish the

team running the operation.

livelihoods of the local people. They are predominantly farmers, so we planted fields

In the short term, the aim is to ensure

and provided seeds, livestock, tractors and

operations run smoothly at the Munali mine

diesel. However, we didn’t want them to

during its first year of production since 2011.

become dependent on us as we currently

Beyond this, CNM plans to explore further

only have a seven-year mine life, although we

opportunities to invest in distressed nickel

are confident that more ore exists below the

mines across the Southern Africa region.

500 metres we have drilled to.”

“We are a private company at the moment, Therefore, CNM established an independent

but CE Mining is a fund that requires an exit

association to support social development

over the next five years. Therefore, we are

projects in the region beyond the current

looking at listing on one of the exchanges

mine life at Munali. The Musangu Foundation

sometime later this year when we have

aims to harness private sector investment,

embedded this operation and have a positive

particularly from the mining sector, to

cash flow.”

provide local market-based solutions.

With a year of nickel production at the “From the local community point of view, they Munali mine and a potential IPO to look have benefitted from the projects we have

forward to in 2019, CNM is entering a new

carried out, and they are also appreciated

cash flow positive phase that could provide

by local politicians. Overall, we have very

the foundations for sustained growth in the

good relations with our neighbours,” Purkiss

Southern African nickel space.

summarises.

CNM has also made sure to employ as many workers from the local community

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MINING | Theta Gold Mines

THETA GOLD MINES A new name for a company operating in South Africa’s oldest goldfield

Resource Global Network

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MINING | Theta Gold Mines

Transvaal Gold Mining Estate (TGME) lays claim to being South Africa’s first gold mining company after being incorporated in 1895, roughly a decade after gold was unearthed from a site called Pilgrim’s Rest in the then Province of Transvaal. This was an unprecedented discovery at the time because the gold mineralisation ran for miles underground, as opposed to the sporadic alluvial gold finds that were commonplace in the region previously. This singular discovery was to have an untold impact on South Africa’s history, kickstarting the famous Witwatersrand Gold Rush which birthed South Africa’s commercial-scale gold mining industry and the city of Johannesburg, which has since grown to become the nation’s largest city today.

Ownership of TGME and the endless mining claims around Pilgrims Rest have been passed through a number of public and private hands during its 124-year history, with ASX-listed Theta Gold Mines the current incumbents in 2019.

Theta purchased TGME in 2012 and initially planned to focus on the underground

Resource Global Network potential of 43 historical mines around Pilgrim’s Rest, Barberton and Sabie, located approximately 370 km Northeast of Johannesburg in today’s Mpumalanga Province.

However, the company’s recent name change signifies a new focus on open pit mining across the prospective area that spans 62,000 hectares and contains a JORC resource of 39.15 million tonnes (Mt) at 4.6 g/t Au for 5.75 million ounces (Moz) - one of the largest JORC resources owned by a junior explorer on the ASX today.

“The name change from Stonewall Resources to Theta Gold Mines signals a clear directional change towards progressing open cut strategies, as well as a new board, and a new company constitution,” says chairman Bill Guy. “This large 620 km2 field has never experienced open cut mining. In Western Australia, the approach of drill testing the old historical underground workings to delineate shallow open cut resources has delivered several newly operational mines.”

Theta Hill The company is focusing its efforts on the Theta Hill deposit within the Pilgrim’s Rest claim and has recently completed a scoping study on the project, which defined a 4.5Mt resource at 4.14 g/t Au for 600,000 oz (85% Inferred) and confirmed the potential low cost of the development and operation.

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MINING | Theta Gold Mines

The scoping study indicated all-in sustaining

The refurbishment of TGME’s existing CIL

costs (AISC) at US$569 per oz along with

plant is the only significant order of business

a low capex requirement of $16 million,

for Theta at a capital cost of $11 million,

primarily due to the fact that a large amount

which will provide the plant with new

of infrastructure is already in place in the

crushing and milling circuits, additional CIL

surrounding area.

circuit tanks, and the upgrade of the elution circuit and gold room.

“There is already a large permitted footprint near Theta Hill with an existing CIL plant

Theta’s scoping study also specified a LOM of

and all associated infrastructure including

7.6 years with a 67,000 oz per annum average

offices, stores, workshops and weigh bridge.

production rate, plus a strong IRR of 132%

In addition, there is an existing tailings dam

and a post-tax/royalty net cashflow of $213

and associated pollution control dams and

million for the LOM.

return water pond. The office, store and workshop infrastructure is currently in use by

While these findings clearly indicate a robust

the onsite exploration management team,”

project, Theta is hoping to further validate

Guy explains.

these numbers in its feasibility study due in the first quarter of 2019.

Resource Global Network

“In the feasibility study, the company is

Additional targets have been identified

planning on confirming the positive project

adjacent to or near Theta Hill which show

economics which came out of the scoping

open-cut potential and could add incremental

study and have a mining reserve to cover two

tonnages to the mine plan. Meanwhile, the

to three years of production.

opportunity to develop a second, high grade open-cut mine at Vaalhoek is also being

“The feasibility study will also allow the

explored by Theta.

board and company to move forward with confidence and a positive study will allow

Theta’s chairman says that in 2019 the

different financial models and financing

company will cost out drilling for the

options to be examined.”

remaining targets around Theta Hill in order to eventually add those into the mining

Beyond its current focus on completing the

reserve, while a drill programme has been

feasibility study for Theta Hill, the company

scheduled at Vaalhoek for the same purpose.

harbours ambitions of undertaking multiple mine developments under a long-term

In addition, the new Columbia Hill discovery

production target of +100,000 oz per annum.

is currently being drilled to test for extensions of the orebodies. “As the year goes on, the exploration team will also

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“The name change from Stonewall Resources to Theta Gold Mines signals a clear directional change towards progressing open cut strategies, as well as a new board, and a new company constitution�

Bill Guy, chairman

ResourceGlobal GlobalNetwork Network 127 Resource

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MINING | Theta Gold Mines

“We believe that our strong environmental focus, plus the offer of two community years ago the jobs“About to a mining with a 130-year history, will build a idea was floated to pivot strong case to support mining again in the local area.”

from being an iron ore exporter to a local steel producer. The idea was that we would build a steel mill in front of the iron ore deposit.”

Resource Global Network consider the underground resources and the

“In broad terms, the company is already

remaining 43 historical mine sites,” Guy adds.

compliant with the main financial aspects

South African mining – on the mend?

of the new Mining Charter,” says Guy. “The company has a 26% black economic empowerment (BEE) ownerships spilt

The reputation of South Africa’s mining

between employees and local community

industry took a beating during the final

groups.

months of Jacob Zuma’s presidency, with corruption allegations swirling around the

“Moreover, the company sees South Africa as

government and all major areas of business,

having many advantages over its neighbours.

including mining.

It’s the most developed country in Africa with strong rule of law, roads, freeways, ports,

Adding to the sector’s woes was an ill-

power stations, a large mining workforce and

conceived rewrite of the Mining Charter

operating mines through the country.”

in 2017 - which was met with vociferous opposition, a stagnant gold price and

Further throwing its weight behind the

continually rising input costs, plus sporadic

sector, Theta recently joined the re-branded

industrial action relating to job cuts, worker

Minerals Council South Africa (formally the

safety and wage grievances.

Chamber of Mines), adding its voice to a respected body of members from across the

All these factors combined to dent confidence national minerals industry. in the mining industry and damaged the jurisdiction. However, after new President

Corporate social responsibility

Cyril Ramaphosa pledged to fix the struggling

Theta also maintains a committed approach

national economy in 2018, hopes are high

to corporate social responsibility (CSR),

that he can steer the mining sector back to

and is involved in various social projects

prosperity.

in communities surrounding the TGME.

reputation of South Africa as a business

The most significant of these is an ongoing The first sign of this recovery materialised in

commitment to local schools, which sees

September when the government published

the company financially support additional

a revised version of the Mining Charter after

teachers at the local school, along with a

months of engagement with key stakeholders

student meal programme and extra teaching

in the industry. The updated version upheld

aids.

plans to raise the level of black ownership to 30% for new mining rights, but allowed

“This year the company will again provide

companies that have already met the 26%

sponsorship to the South African National

threshold to remain at that level.

Gold Panning Championships, which have

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been held on the company’s mining claims at Pilgrims Rest for the last 21 years.

“The event attracts a large number of tourists but is primarily a family day with races and events taking place. Overall, the Panning Championships has a very positive affect on the local economy,” says Guy.

Resource Global Network

From an environmental perspective, Theta

“We believe that this strong environmental

has explored many ways of reducing its

focus, plus the offer of jobs to a mining

impact on the environment and this is

community with a 130-year history, will build

evidenced by the company’s choice of mining

a strong case to support mining again in the

method for the Theta Hill project.

local area.”

Contour haulback mining is mostly used

In 2019, the company will continue

in the coal industry for mining shallow

drilling and development at Theta Hill as

thin seams but will be utilised at Theta Hill

it progresses towards the ultimate goal of

to significantly reduce its environmental

pouring gold bars, with the first big milestone

footprint and the cost of earth works too.

set to arrive in early 2019 when the feasibility study is published.

“Applying coal mining techniques and technologies into a gold mine is innovative

“Bringing the shallower open pit resources

and means that mining and rehabilitation

onstream first will then allow further

are carried out simultaneously, leaving the

underground mine exploration and

natural contours of the hill intact with no

development to be funded out of cash flow,”

remnant open pit.

concludes Guy.

ASX:TGM

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MINING | Cardinal Resources

CARDINA

Resource Global Network

AL RESOURCES Gold exploration in Ghana’s underexplored Northeast

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MINING | Cardinal Resources

Cardinal Resources has roots in West Africa that go back nearly 30 years, at a time when Nelson Mandela finally walked free after 27 years of imprisonment in South Africa.

At this critical juncture in recent sub-Saharan African history, Archie Koimtsidis walked into West Africa with a motive to explore for gold across the highly prospective region. The Australian-born explorer and a few other Cardinal forefathers soon decided to refine their focus to Ghana, as it was English speaking and already had a relatively well-established mining sector at the time. “It was easier to go to the known rather than the unknown at that time,� explains Koimtsidis.

The team initially focused on the mature gold mining industry in the South of Ghana, which had seen production from a conveyor belt of gold mines since the turn of the 20th century and even earlier in some cases.

However, as part of its early regional scale exploration the company did set foot up in the North, discovering some colluvial gold and an outcrop in one particular location.

Having seen this exploration potential, Koimtsidis vowed to return to the North at some point in the future.

Resource Global Network

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MINING | Cardinal Resources

Resource Global Network

Returning to the North

“There used to be this conception that there

Staying true to his word, Koimtsidis returned

wasn’t any gold up in the North, due to a lack

to the underexplored Birimian terrane of

of understanding of the geology, but we saw

Northeastern Ghana around 15 years ago,

colluvial nuggets close to the surface many

and spent the subsequent years building

years ago, so I begged to differ.”

confidence in the region.

Since these early sightings of gold, Cardinal The geology underpinning Ghana’s Northern

has developed its Bolgatanga project,

territory is more complex compared to

contained within the Paleoproterozoic

the Southwest of the country, which has

Granite-Greenstone Belt in Ghana’s upper

resulted in the majority of mineral explorers

Northeast, close to the Burkina Faso border.

congregating in the latter region during the 1990s and 2000s.

In fact, the closest large-scale producing gold operation is the Youga mine – a 2 million

However, armed with more sophisticated

ounces (Moz) resource located in Burkina

exploration tools, Cardinal has built a

Faso and currently owned by Avesoro

commanding land position in the Northeast,

Resources.

and is slowly reaping the benefits.

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MINING | Cardinal Resources

ResourceGlobal GlobalNetwork Network 139 Resource Back across the border in Ghana, Cardinal

over 2015 and 2016. However, it was not until

enjoys access to a well-established

2018 that real progress began to take shape.

infrastructure network surrounding the Bolgatanga project, which includes a sealed

“We kicked off 2018 with a preliminary

national highway, plus national HV hydro grid economic assessment (PEA),” says Koimtsidis. power and continuous water supply.

“Then a month later we updated the resource and then converted that into a preliminary

With a mining licence granted for 15 years

feasibility study (PFS) in September. So,

renewable, Koimtsidis and co believe that

within nine months we have published a PEA

Northern Ghana could well be a new frontier and a PFS with a sizeable reserve in it.” for gold exploration and mine development in the entire West Africa region.

The Namdini licence

The PFS found that Namdini contains 4.76Moz of gold from a maiden probable

The Bolgatanga project is comprised of

ore reserve estimate

four licence areas, with the Namdini mining

of 129.6Mt at a head

licence the primary focus for Cardinal.

grade of 1.14 g/t gold,

Namdini was purchased in 2014 with

with a 0.5 g/t cut-off

exploration drilling commencing at the site

grade.

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MINING | Cardinal Resources

“We kicked off 2018 with a PEA. Then a month later we updated the resource and then converted that into a PFS in September. Within nine months we have published a PEA and a PFS with a sizeable reserve in it.�

Archie Koimtsidis, CEO/managing director

Resource Global Network Key financial metrics in the study were based on a gold price of US$1,250 per ounce and included a post-tax NPV of $586 million and a post-tax IRR of 38%. All in sustaining costs were calculated at $769 per ounce for the life of mine and 1.8 years was the estimated total project payback time.

This large scale open pit operation will eventually produce 3,975,000 ounces of gold (approximately 125 tonnes) over a 14 year mine life, including 907,000 ounces produced from a 2.5 years long starter pit with an AISC of $599. Furthermore, Namdini remains open along strike and down dip, inviting the possibility of an extended mine life. “One of the key strengths of Namdini is the fact that the processing facility is conventional. There is nothing complex in the processing and everything is off the shelf,� says Koimtsidis.

The PFS outlined a 9.5 million tonnes per annum (Mtpa) process flowsheet with a conventional crush-grind-float-regrind-CIL circuit and a gravity gold circuit designed for free gold. This process will eventually result in the production of gold dorĂŠ bars on-site, a big plus for the company.

For Koimtsidis, the PFS is a significant step in the right direction at Namdini, and it gives the company confidence to progress with a definitive feasibility study (DFS), which has commenced and is anticipated for Q3 of 2019.

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MINING | Cardinal Resources

District exploration

Ndongo East and received new drill results in

In addition to the DFS, Cardinal will also be

the post-wet season.

focusing on district exploration next year.

The firm’s land package at Bolgatanga totals

These assays included intersections of three

close to 900 km² and provides significant

metres at 29.3 g/t gold from 45 metres and

exploration upside from three additional

three metres at 4.1 g/t gold from 122 metres.

licence areas.

Drilling will continue at Ndongo East after the conclusion of the 2018 wet season, with

Around 20 km North of Namdini is the

further results pending. But, one thing for

Ndongo licence area, where six large scale

sure is that Koimtsidis is encouraged by the

targets have been identified and subject to

results so far.

RC drilling, returning several shallow gold intersections.

“The idea with this district exploration is to find some shallow high grade ounces that

In fact, one of these targets yielded a

can be fed into the production facility to give

discovery in July 2018 at Ndongo East,

it some extra NPV,” he says.

after RC drilling returned significant gold mineralisation. Throughout the rest of the

“If our exploration work discovers something

year, Cardinal extended the strike length at

bigger than just shallow pits, than that’s a

Resource Global Network and processing facilities. Cardinal purchased the Subranum project from Newmont Mining and is currently in the process of evaluation ahead of a potential drill programme.

“There is a 5-7 km zone that is possibly mineralised within that licence,” says Koimtsidis. “We need to do some more work on that in the new year.

“That could end up being a standalone project or something that gets shipped down to the other processing facilities further South or sold to some of those miners already with assets in the South.”

Finally, Cardinal will continue to work closely with the communities living in the shadow of its licence areas in Ghana over the course of good problem to have. The plan is to keep

2019 and beyond. As a long-term resident,

investigating these licences for further

Koimtsidis understands the culture of

ounces.”

Ghana, which helps inform the company’s

Possibilities in the South

understanding of what the communities want from an exploration/development company.

Beyond Cardinal’s twin goals of publishing a DFS for Namdini and continuing district

“We work together as a team and they assist

exploration across the Bolgatanga

us as much as we assist them to make sure

project, the company may also decide to

that eventually a mine is built which provides

recommence drilling at its Subranum project

jobs for generations to come. Our situation

in Southern Ghana.

is a little unique. It didn’t start as Cardinal, it started nearly 30 years ago.”

The 69 km² licence straddles the Eastern margin of the Sefwi Gold Belt, an area that is densely populated with producing gold mines

ASX:CDV

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MINING | Hummingbird Resources

HUMMINGBIRD RESOURCES

checks in with Hummingbird Resources’ MD Dan Betts

Resource Global Network

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MINING | Hummingbird Resources

2018 was a year of transformation for Hummingbird Resources as the AIM-listed company completed its journey from gold explorer to gold producer at the Yanfolila mine in Mali, West Africa. After ramping up to full-scale production in Q1, the miner went on to pour 91,620 ounces of gold in 2018 – only a few hundred ounces short of its top end revised guidance, after an unusually heavy wet season limited capacity at Yanfolila.

However, the Hummingbird team rose to the challenge and executed a remediation plan to get the operation back on track this year, as it works towards a 2019 guidance of 110-125,000 ounces of gold. Also on the agenda for Hummingbird this year is the construction of a second ball mill at Yanfolila and a near-mine exploration campaign. RGN’s editor catches up with Hummingbird’s managing director Dan Betts, who also discusses the firm’s partnership with Cora Gold and the Dugbe project in Liberia.

Jacob Ambrose Willson: Dan, after reaching nameplate capacity at the Yanfolila mine in Q1 last year, the

Resource Global Network primary target for Hummingbird in 2018 was to maintain those production levels.

What challenges arose over the course of the year and how happy are you with the overall gold output of Yanfolila in 2019?

Dan Betts: 2018 was an important year for us at Yanfolila, with successful ramp up of operations and consistent grade and recoveries coming out of our plant. Of course, the latter part of the year proved slightly more challenging when stability issues were identified at the Komana East pit and a public bridge on the road to site was issued a restrictive weight limit. These issues were a result of unusually heavy wet season.

With our remediation plan nearing completion though, the Group is now in a good position to return to full capacity and continue the cash generation that Yanfolila is capable of. Notwithstanding, we are one of the top 10 UK producers in year one of operation, we’re confident with the guidance figure we’ve given for 2019 and look forward to pouring more gold!

JAW: How will Hummingbird ensure Yanfolila hits its 2019 FY guidance of 110125,000 ounces and therefore ensure the company returns to full profitability?

DB: Last year’s issues have certainly made for a more experienced and skilled team and we can now take what we’ve learned from those challenges to work towards a wholly positive 2019. Our project to install a second ball mill is due to be complete in Q3 and this will

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MINING | Hummingbird Resources

Resource Global Network increase our plant throughput towards the end of the year. All together, these elements will help us deliver on our expectations.

JAW: Hummingbird also embarked on an exploration programme at Yanfolila last year. To what extent have the recent high grade returns from the Gonka and Komana West deposits increased confidence in the extension of the mine life at Yanfolila?

DB: The drilling results have been hugely encouraging. Drilling commenced in July last year and has more recently focused on the resource definition at Gonka, with some further follow up drilling at Komana West.

The results have highlighted the high grade returns from Gonka as well as signified zones at Komana West inside the minable pit shell (previously found outside the resource model). The results collectively give us encouragement that we can increase the mine life at Yanfolila.

JAW: How much further exploration is required across the six near-mine deposits in 2019 in order to convert the maximum amount of resources to reserves?

DB: So far, the Group’s exploration drilling has focused on infilling the open pit resources. Our attentions will now switch to drilling out the underground resources at Gonka, which is very exciting since this is where the highest grades and wider intervals

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MINING | Hummingbird Resources

have been previously drilled by Gold Fields

increase throughput capacity from 1Mtpa to

Ltd, the former licence owner.

1.24Mtpa (+24%) when operating at 100% fresh ore. With our service contractor AMS,

Once the exploration results are received

we are also evaluating ways to streamline

and analysed, we can set out the findings and

operations and allow further throughput on

see how these can benefit the mine life at

an ongoing basis.

Yanfolila, which should be within the course of the year.

JAW: Turning to Hummingbird’s partnership with Cora Gold, how are you

JAW: How important is it for Hummingbird

assisting them with their exploration

to continue developing Yanfolila’s

efforts in Mali near the Yanfolila mine?

facilities as it anticipates further reserve growth?

DB: We’re encouraged by Cora’s progress in Mali and while we don’t have a part

DB: Developing our capacity is a key objective

in operationally assisting the Group per

and a second ball mill will significantly

se, Yanfolila does provide optionality

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BRINGING MORE TO MINING

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MINING | Hummingbird Resources for their exploration campaign. Bert Monro, Hummingbird’s head of business development, sits on Cora Gold’s board and is there to lend his extensive experience in the sector.

JAW: How much of a priority will the development of the Dugbe gold project in Liberia be in 2019?

DB: The Dugbe Gold Project currently has a gold resource of 4.2Moz, so it’s a significant asset and one of real value to Hummingbird.

The Dugbe Mineral Development Agreement (MDA) is now going through the final phase of approval from the Liberian Government.

Once this is complete, we will be able to consider our next steps for the project.

JAW: The partnership with Cora (who are also active in Senegal), along with Hummingbird’s own assets in Mali and Liberia, shows a real commitment to West Africa’s gold industry. What can you say about West Africa as an investment jurisdiction and as a world-class gold hub?

DB: West Africa has been a prosperous and important part of Hummingbird’s success.

We’re proud of our in-country relations and what we’ve achieved in the region to date. While we do look at a broad range of projects globally, the region speaks for itself as a prolific gold exploration and production area. Ultimately for us though, it’s about finding the right project for Hummingbird, which comes down to our experience and strengths.

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MINING | Hummingbird Resources

Resource Global Network JAW: Hummingbird undertook a targeted year-round local community beneficiation programme in 2018, which involved creating employment opportunities for local women and clean water initiatives amongst other areas. What will the company focus on in 2019 as part of its approach to responsible mining?

DB: Last year’s far-reaching responsible mining projects were carried out successfully and we’ll be setting ourselves the same ambitious goals for 2019. The programme has not been published yet but continues our focus on water and sanitation, agriculture, local employment, education and crucially, health. The latter in particular is hugely significant to us and I’m pleased that we’ll be continuing our partnership with Critical Care International (CCI) to deliver an incredibly high standard of healthcare to the mine and local communities.

JAW: Finally, if the main priority for Hummingbird last year was consolidation, what is the stand-out objective for 2019?

DB: The plan for 2019 is to focus on achieving production guidance and completing the second ball mill project to time and budget.

Together with further positive exploration results, we would hope to establish ourselves as a mid-tier mining company in 2019.

AIM:HUM

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MINING | Indiana Resources

INDIANA RES A growing gold focus in Mali

SOURCES

Resource Global Network

157

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MINING | Indiana Resources

The history of Indiana Resources of Koussikoto Ouest and Kenieko Nord, can be traced back to 1984 when in which it holds 75% and 95% interests respectively. The remaining interests are held it was listed under a company by local partners. In return, Anderton sits on called Goldstream Mining NL. Since then, the firm has looked the Indiana share registry with about 13% ownership. at various opportunities in the nickel mining space and owned Leadership expertise a producing iron ore project at Indiana’s board and management team is one stage before entering Mali’s led by a triumvirate of highly experienced well-established gold sector mining professionals, with non-executive following recent developments chair Bronwyn Barnes and non-executive director Bruce McFadzean working alongside in Tanzania, where it owns van Wijk. a nickel project. The Indiana licences and the current team “Bronwyn and Bruce are well known in the on the ground have been exploring in Mali since 2013, but Australian resources space. Bruce is the it was only last year that these managing director of Sheffield Resources, a very large mineral sands play in Western licences, located in Kenieba Australia. Bronwyn has been involved in the Province, were brought into small cap end of the market for many years Indiana through the acquisition and sits on the board of a couple successful of Mukuyu Resources and a joint juniors including Mod Resources. venture with Cradle Arc – giving Indiana a total of four licences in “But more importantly, she has worked in close proximity within this highly Guinea and various other countries in West mineralised Birimian Greenstone Africa, has a private venture in Burkina Faso and speaks excellent French,” he adds. Van belt.

Wijk is also conversant in French and has

“After the recent developments in Tanzania

worked in several other countries in West

we were looking for a project elsewhere and

Africa prior to leading Indiana in Mali.

there was a willing vendor in Peter Anderton with Mukuyu Resources. He was the man

Under the guidance of van Wijk, Barnes

who vended the first two Mali assets into

and McFadzean, Indiana has focused on

Indiana,” says chief executive Chris van Wijk.

consolidating its land position in Western Mali following the acquisition of Koussikoto

Anderton did an all-share deal with Indiana, giving the company ownership

Ouest and Kenieko Nord.

Resource Global Network

159

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•

Directional

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Exploration and delineation

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Underground drilling

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Operational bases across Africa

Burkina Faso Guinea

Ethiopia

Cote d’Ivoire Ghana

Kenya

*Democratic Republic of the Congo

DRC*

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Botswana

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Resource Global Network

Soon enough, the company bolstered its land

not received the amount of exploration

package through a JV deal with Cradle Arc

attention that it deserved.

in August 2018, which provided two further licences in the shape of Kossanto West and

“We saw an opportunity there because

Koussikoto, located a short distance North of

most of those leases weren’t held by

Indiana’s initial licences.

majors, allowing us to go in and do some consolidation. We want to put together a

When studying a map of the area, it becomes

decent sized land package that would be

clear that Indiana’s four licences are located

interesting to a larger firm. We believe we can

smack bang in the centre of three large

do that quicker and cheaper than the majors

regional gold camps. To the North you will

can.”

find the Sadiola and Yatela deposits, to the Southeast are Loulo and Fekola and toward

This brings sharply into focus Indiana’s

the Southwest is the Sabodala mine in

strategy with regards to its status as a gold

Senegal, owned by Teranga Gold.

explorer and not a mine developer. “The company has no illusions about wanting to

With this in mind, Indiana’s board concluded

go into production,” van Wijk explains.

that the central area intersecting these major gold camps was highly prospective and had

“We believe that the best value is in putting

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MINING | Indiana Resources

together a land package, working it up to

These facilities join an illustrious list of gold

point where we have a decent resource and

mines operated by giants of the industry

then moving that on for someone else to put

including Randgold Resources, Anglogold

into production.”

Ashanti, Resolute Mining and IAMGOLD. As

The land of giants Mali’s is Africa’s third largest gold producer

such, Mali’s geological pedigree is in no doubt considering the calibre of multinationals invested in the sector.

and expects output to increase by almost 21% to 600 tonnes in 2018, thanks to new

However, Mali’s standing as a reliable

facilities coming online such as B2Gold’s

investment destination has been called

Fekola and Hummingbird Resources’ Yanfolila into doubt in certain quarters after security mines.

Resource Global Network

“We want to put together a decent sized land package in Mali that would be interesting to a larger firm. We believe we can do that quicker and cheaper than the majors can” Chris van Wijk, CEO

issues came to the fore in 2017, including a

“The corruption that West Africa is well

terror attack near the capital Bamako and

known for is never encountered at the high

escalating conflict in the less fertile (hence

level of government that we have to deal

poorer) North of the country.

with,” he says. “From that point of view, it’s much easier than operating in Guinea, Liberia

Nonetheless, the commitment of the mining

or any other countries I’ve experienced in the

community to Mali has been unwavering

region.

since these incidents and van Wijk believes Mali is in fact a much safer jurisdiction

“All of Africa is a complex overlay between

compared to some of its West African

tribal interests, clan interests and religion and

counterparts.

Mali is no different. One redeeming feature

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MINING | Indiana Resources

of Mali is that religion is uniformly Muslim, so

Progressing the licences

that kind of complexity dies away.”

Returning to the licences in Kenieba Province, Indiana’s scope of work in 2018 centred on

On a government level, Indiana has

geophysics using Induced Polarisation (IP)

established strong communication lines with

methods at Koussikoto, which was followed

the Malian Ministry of Mines, as evidenced

by around 4,000 metres of drilling.

by a meeting van Wijk held with the current Minister of Mines Lelenta Hawa Baba Bah at

The drilling programme returned some

the end of 2017.

excellent hits including 18 metres at 3.35 g/t Au and 5 metres at 4.86 g/t Au. Follow-up

“The doors are wide open for us and they

drilling and further ground consolidation is

[the Mali Government] are keen for any

planned this year.

form of investment. Mali is complex, but we believe it is a better jurisdiction to operate in

“Now, the plan is to do geophysics on the

than the majority of West African countries

Northern licences that comprise our Cradle

and it will remain our main focus for the time

Arc JV and the Western part of our Koussikoto

being.”

licence. Then we will aim to do more air core drilling surrounding the strike from where

Resource Global Network

we have had promising hits, to see if we can

Patience in Tanzania

define any targets with the geophysics and

Indiana is also maintaining its position in

geochemistry.�

the Ntaka Hill nickel project in Southern Tanzania, despite the recent controversy

Indiana has been running a primarily self-

and upheaval that has gripped the mining

sufficient model in Mali so far, preferring to

sector. The company maintains that the

undertake a wide range of tasks in-house

project resembles a significant and exciting

including the construction of a mining camp,

opportunity, but changes to the Tanzanian

and has also brought its own staff for the

mining act have led to its Retention licence

camp, along with its own vehicles and drivers.

being cancelled.

However, Indiana’s drilling partner thus far

In a recent meeting, the Tanzanian

has been Amco Drilling and it has used a local

government explained to Indiana their

geophysics company called Sagax to do the

intention to eventually return the tenure,

IP work and subsequent interpretation of the

provided they accept the new ownership

results. Beyond these contractors, Indiana is

structure which dictates that the state must

self-sufficient almost end-to-end.

hold a 16% stake in the project.

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MINING | Indiana Resources

Chris van Wijk and Mali Delegation at Africa Down Under 2018

Resource Global Network

“We are not looking to build mines, we are looking to get those assets to a point where they are sale or JV ready.”

Meanwhile, the government is still embroiled in a two-year long tax dispute with Barrick Gold’s Acacia Mining, therefore until this major conflict is resolved Indiana feels that the picture surrounding Ntaka Hill will not get any clearer.

“We are confident that we will get our tenure back at some point and the ultimate plan for the Ntaka Hill licence is to partner it. Once again, we are not looking to build mines, we are looking to get those assets to a point where they are sale or JV ready,” says van Wijk.

This brings us back to Indiana’s long-term goal of building enticing land packages in prospective mineral belts that would eventually attract the interest of the majors.

In the short term, the company plans to continue consolidating its Mali licences and is quietly hopeful that a consensus will be reached in Tanzania’s mining sector.

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MINING | Midnight Sun Mining

MIDNIGHT SUN M

I

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Staking a claim in Zambia’s copper-rich North-Western Province

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MINING | Midnight Sun Mining

Midnight Sun Mining is a postdiscovery stage copper-cobalt exploration company with a 60% interest in the Solwezi group of licences located in Zambia’s North-Western Province. The Solwezi licences consist of two individual exploration licences covering 506 km² immediately adjacent to First Quantum Minerals’ (FQM) Kansanshi Mine – the largest copper mining complex in Africa, with resources greater than one billion tonnes.

“Our philosophy was twofold,” explains Midnight Sun’s lead director and acting CEO Al Fabbro. “First and foremost, we liked the jurisdiction of Zambia. Second, we liked the infrastructure already provided

by FQM’s Kansanshi Mine. As a junior, it gave us optionality on the assumption that we made a discovery.”

A copper mining haven Zambia’s mining industry has been an investor-favourite in Southern Africa since the industry was first opened to private venture in the late 1990s.

The twin pillars of peace and democracy have remained a near-constant since Zambia gained independence from Britain

Resource Global Network in 1964 and have been a key reason behind the country’s continued attractiveness as an investment destination, particularly in the mining sector.

The mineral prize that lies at the heart of Zambia’s investment appeal is copper, which is mostly found in the Central African Copperbelt straddling the border between the Southern region of DRC and Northern Zambia, where there is even a province named after the prolific Copperbelt.

Since the privatisation of the mining sector, Zambia’s copper production has skyrocketed from 300,000 metric tonnes per year to 800,000 at the end of 2017, making it Africa’s second largest copper producer behind only neighbouring DRC. In fact, copper has a huge impact on the fortunes of Zambia as a country and its people, according to Fabbro. “Copper is the dominant industry here and accounts for about 85% of the country’s exports and the majority of its revenues.”

The robust Zambian copper industry has enticed a host of major mining companies to set up exploration projects in the Copperbelt, including the likes of Barrick Gold, Rio Tinto, Glencore, Ivanhoe Mines and FQM. Many of these have gone on to build large-scale copper production complexes across the region, however rumblings of discontent have begun to emanate from these international mining houses after the

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MINING | Midnight Sun Mining

Zambian government recently moved to

mining industry. We are making investments

increase royalty taxes on the mining sector.

with horizons of sometimes 40 years or more, but governments tend to change the

At the start of 2019, the government raised

goal posts depending on which way the wind

its sliding scale for royalties from 4% to 6%

is blowing.

and introduced a new 10% tax when the price of copper exceeds US$7,500 per tonne.

“Having said that, I think the Zambian

Zambia also plans to replace value-added

government fully understands how important

tax with a sales tax by April to help reduce a

copper is and they are starting to realise

mounting public debt.

that if they encourage the development of new mines, they will generate much greater

Speaking on the subject of tax, Fabbro

tax revenues than by changing what’s been

explains that this type of action is common

successful in the past.”

in all jurisdictions not just Zambia: “I live in British Columbia, Canada and it feels like our

The Solwezi licences

government changes the goal posts for the

Midnight Sun remains unfazed by the recent

resource sector every week.

legislative changes in the Zambian mining sector, instead placing increased faith in the

“It’s one the greatest challenges facing the

Solwezi licences in North-Western Province,

Resource Global Network

a region which has been christened the ‘new

staked around by MMG and Rio Tinto based

Copperbelt’ by many enthusiastic exploration

on our discovery, which shows there is a

companies.

keen interest from majors on the ground we are working on. We think the land we hold is

The Solwezi licences are located within 10 km

strategic and very prospective.”

of FQM’s Kansanshi Mining Complex, only 60 km from Barrick Gold’s Lumwana Mine

After carrying out geochemical and

and concentrator and a further 120 km from

geophysical surveys, along with air core, RC

another FQM asset - the Sentinel Mine.

and diamond drilling campaigns, Midnight Sun identified five targets across the Solwezi

This glut of high quality copper mines in the

licences: 22 Zone, Mitu, Dumbwa, Kifubwe

region not only offers a strong testament to

and Khaziba. In the last 12 months, the

the glittering potential of the Solwezi licences,

company has predominantly focused on 22

but also provides a strong infrastructure

Zone and Mitu.

network that Midnight Sun can leverage off, as previously alluded to by Fabbro.

At 22 Zone, Midnight Sun encountered multiple intercepts of high grade copper

“There are some really nice mines in the

oxide in drill holes and made a significant

immediate vicinity,” he says. “We’ve also been

drill discovery of 11.3 metres at a grade of

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MINING | Midnight Sun Mining

“First and foremost, we liked the jurisdiction of Zambia. Second, we liked the infrastructure already provided by FQM’s Kansanshi Mine” Al Fabbro, acting CEO and lead director

5.71% copper. However, Fabbro admits that

“We would like to drill four 400 metre holes

to date this near surface mineralisation lacks

into the target to see what it looks and

continuity, which was also incidentally a

based on the results work from there. If it’s

feature of early exploration on the Kansanshi

another Kansanshi, it’s a company maker,” he

system.

exclaims.

“We’ve got some extremely high grade oxide

Meanwhile, the Mitu target has yielded a

holes at the surface, but the analogy is more

copper-cobalt discovery in ore shales to

like a buried Kansanshi. There seems to be a

the far North of the known Mitu trend.

geophysical target down at 250 metres that

Diamond drilling has encountered significant

looks very enticing and that’s likely going to

mineralisation including an 11.6 metres

be our next foray at 22 Zone.

interval assayed at 3.44% copper and 0.067%

Resource Global Network

cobalt. The Mitu discovery was made after a

While the company had been focused on

very subtle soil anomaly was detected by a

the Northern part of Mitu, they have also

geochemical survey.

uncovered a number of larger geophysical anomalies that could result in a much bigger

“We got a couple of drill hits up there and

deposit. “The geophysics has really told

stayed focused on the area, tracking the

a compelling story. One of the priorities

mineralisation. We’ve got what looks like

of this year is to test targets identified by

several kilometres of strike, about 300 to 400

geophysical surveys conducted during 2018.”

metres of potential dip and widths look to be about 10 metres. Based on drilling done to date we are seeing roughly 1% copper equivalent.”

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MINING | Midnight Sun Mining

A big year ahead Over the course of 2019, Midnight Sun will

“First and foremost, we need to understand

dive deeper into the geophysics at Mitu and

the structural controls of the mineralisation

select the three best drill targets in order to

at Mitu, and we don’t fully understand them

confirm the geophysics. If the geophysical

yet. We thought at first it was the ore shales

results can be confirmed, then it will modify

alone that controlled mineralisation, but

plans for progressing the target to suit the

recent results have shown there are other

requirements.

additional control factors.

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177

Midnight Sun has also identified a new potential zone located between Mitu and 22 Zone that looks very attractive, according to Fabbro. “We are going do some work there aimed at developing drill targets as a third priority behind Mitu and 22 Zone.”

Casting his eyes towards the horizon, Fabbro maintains a flexible stance on the prospect of Midnight Sun ultimately developing a copper mine on the Solwezi licences. “If we do get to a production decision, we recognise we would have to bring in a whole set of people with different skillsets, which is definitely achievable.

“However, our intention is to create an asset that a senior mining company would want to own. Ultimately our goal is to maximise the value to Midnight Sun and its shareholders, whatever form that takes.”

Returning to the present, Midnight Sun’s acting CEO concludes by reasserting his confidence in Zambia’s new Copperbelt region. “With a bit of luck, we could be the story of the year for 2019.” If the deposits surrounding the Solwezi licences are anything “Once we learn and understand the structural to go by, this could well be the case. control, we will be more comfortable at Mitu and I think the geophysics will really help.

One of the first steps in proving an ore body is understanding the structural controls,” Fabbro reasons.

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MINING | Kogi Iron

KOGI IRON Nigeria’s first primary steel production project

Resource Global Network

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MINING | Kogi Iron

Nigeria has the largest economy in Africa with a GDP of approximately US$376 billion in 2017 and is also the continent’s most populous nation, comprising of close to 200 million citizens according to latest UN estimates. Therefore, it is a great surprise to learn that Africa’s primary economic engine consumes only 6.8 million tonnes per annum (Mtpa) of steel, giving Nigeria one of the lowest levels of consumption per capita in the world. More than half of Nigeria’s steel demand is met from imported goods, with the balance provided by domestically produced, low quality steel largely from recycled metal. However, Kogi Iron plans to drastically enrich Nigeria’s domestic steel industry by setting up the country’s first integrated cast steel project in Kogi State.

Kogi Iron is an ASX-listed company that has been in operation for around 10 years, with its primary asset the 100%-owned Agbaja iron ore project located near the town of

“About two years ago the idea was float ore exporter to a local steel producer. Th build a steel mill in front of the iron ore d Martin Wood, CEO and managing directo

Lokoja in central Nigeria. The project is

are in place at the project level, says Kogi

operated through Kogi Iron’s 100% owned

Iron’s CEO and managing director Martin

partner - KCM Mining.

Wood, and the resource has been estimated at 586 Mt with an in-situ grade of 41.3% Fe

All currently required licences and permits

from a 2014 pre-feasibility study.

Resource Global Network

ted to pivot from being an iron he idea was that we would deposit.” or The company’s initial plan was to prove up

ore prices had receded after the China-

the resource, develop the mine and then

led boom ended in 2014, and the process

export the iron ore out of Nigeria. However,

of transporting the produce from Lokoja

it soon became clear that this wasn’t going

down to Warri Port in the South became too

to work, primarily for two reasons: Iron

complex.

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Pivoting towards steel production “About two years ago the idea was floated to pivot from being an iron ore exporter to a local steel producer,” reveals Wood. “The idea was that we would build a steel mill in front of the iron ore deposit.

“We’ve also got access to two local sources of coal and there is lots of readily available limestone in the region, therefore we have all the ingredients needed to produce steel for the home markets.”

As it transpired, all the factors that made it difficult for the company to export its product lent themselves to becoming

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Logistically speaking, from the project’s central location potential offtakers could in the Southwest and Port Harcourt in the Southeast.

In this scenario, Kogi Iron can truck its steel product down to these regions, as opposed to having to barge iron ore down a river before loading it onto a narrow gauge railway to eventually reach Warri Port. In addition, the integrated project would operate inside the Nigerian Tariff Barrier which is a major plus for the firm.

Since deciding to pivot towards integrated steel production, Kogi Iron has carried out a number of tests on its iron ore to determine its suitability for the manufacturing of international quality steel products.

Resource Global Network

The company employed consultancy groups

operational in Nigeria. In order to check

Tenova, SGS Bateman and Mintek RSA to

that thesis, we recently commissioned Fast

perform a bulk sample test work programme

Markets to carry out a market study for us.”

in July last year. The mineralogy specialists ran successful tests which confirmed the

The Fast Markets study concluded that Kogi

suitability of Agbaja iron ore to produce a

Iron would be able to sell one and a half

high quality steel product.

million tonnes of its steel product in Nigeria and into neighbouring countries, which is

Russia-based specialist Torex also confirmed

an encouraging sign for the company at this

the viability of Kogi Iron’s two local sources

stage.

of coal for use in the rotary kilns as part of the sponge iron process. “Once you know

Nigeria’s current domestic rolling mills

you can produce a high quality steel product,

predominantly use imported scrap metal to

then you know the project is a go,” Wood

produce low quality items such as rebar and

declares. “Our idea is that we are inured to

hot/cold rolled steel and wire coils. Therefore,

the international prices of coal and iron ore

the Fast Markets report indicated that

because we have our own supplies.

there will be no shortage of demand for the company’s higher quality material.

“We will produce a cast steel product that will be sold to the rolling mills that are currently

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MINING | Kogi Iron

DFS and project financing Kogi Iron is currently working through its definitive feasibility study (DFS) and has commissioned an independent engineering consultancy called McLellan and Partners to conduct an interim review of the company’s progress at the Agbaja project.

“That review is going to give us objective numbers on the capex needed to build the project and the opex required to run the facility. It will also give us a pathway towards the full DFS, advising on things like what tonnage we should be producing and where we should be sourcing equipment from.”

In terms of project financing, the firm has been in discussions with export credit agency (ECA) lenders for quite some time and has made sure that each potential ECA is kept firmly in the loop with regards to key milestones and news pieces.

For example, after the Tenova, SGS and Mintek sample test work programme was completed, the results were shown to the ECAs in order to demonstrate that the work fits the necessary criteria. Kogi Iron will continue to share goals and milestones with potential lenders to keep itself ECA compliant.

It has been indicated that ECAs will be willing “That means that when we finish all our

to lend up to 70% of the project cost, leaving

studies, assuming the DFS is positive, we will

the company with 30% to raise through

have taken ECAs with us on our journey and

equity. Kogi Iron is considering various

they will have a very short turnaround in

options for this equity raise, including a

deciding whether or not they can lend to us,”

second listing on an international exchange.

says Wood.

ResourceGlobal GlobalNetwork Network 185 Resource

“We are exploring a dual listing in London to raise the 30% capex to finish off the project. That would give us a good footprint in London and allow investors in who understand West Africa.”

“One of the options we are exploring is a dual

Wood believes the UK exchange has a very

listing in London to raise that 30% capex to

strong understanding of African markets

finish off the project. That would give us a

along with a large Nigerian contingent

good footprint in London and allow investors

residing in London, which makes it a highly

in who understand West Africa, steel and the

suitable option for a secondary listing. “That

long-term economics of the project.”

would be a conceivable path to market and liquidity for us,” he adds.

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MINING | Kogi Iron

Resource Global Network

A social licence to operate

you do for us. On several occasions he has said: ‘I know there is nothing in it for us now

Aside from moving through the technical

but we can see the future jobs and education

and financial aspects of the Agbaja project,

for Lokoja which are being driven by this

Kogi Iron has also developed a highly

economic engine you are building’. That’s a

attuned social licence to operate in Nigeria,

very sensible, mature approach and I love it.”

which is rooted in the notion of providing local, regional and national benefit from its

Kogi Iron also maintains strong relations at

presence in the country.

state and federal level, including with the Minister of Mines and Steel in Abuja. “When

On a local level, the firm has negotiated

we first had some steel produced from our

a thorough community development

own iron ore by Mintek, they sent us some

agreement (CDA) with the paramount ruler of

samples,” Wood explains.

the region, who presides over the more than 60 communities which will be impacted by

“I took a sample and gave it to the Minister

the development.

of Mines and Steel as a paperweight. It’s the first steel produced by Nigerian iron ore, so

“Through the paramount ruler, a local lawyer

he was really pleased about. It was a nice

and local dignitaries who represent the

gesture from us.”

stakeholders, we negotiated a CDA which ensured local employment opportunities in

Kogi Iron is making strong progress towards

both unskilled, semi-skilled and skilled roles,

its goal of developing Nigeria’s first primary

to ensure that local benefits will accrue.”

steel production facility, which is set to bring myriad benefits to the local communities in

Kogi Iron’s national subsidiary KCM Mining is

Kogi State and to the Nigerian economy.

led by a geologist named Alabi Samuel, who is Lokoja born and bred which has helped

Above all, Kogi Iron must be commended for

the company form strong relations in the

developing the operation in-country through

surrounding communities, not least with the

its 100% owned partner KCM Mining and for

paramount ruler.

advancing a project that will support Nigerian industry and Nigerian people.

“His [the Paramount Ruler] view is very overtly what can we do for you, not what can

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APPOINTMENTS & EVENTS

APPOINTMENTS Petra Diamonds names Richard Duffy as new chief executive African miner Petra Diamonds has appointed a new chief executive to lead a debt-cutting and free cash flow-generating strategy, after lower diamond prices hit the company’s first-half core earnings.

Richard Duffy has held various finance posts in his 27 years in the mining industry, including with Anglo American and AngloGold Ashanti.

“The focus to generate free cash flow remains paramount for the company,” said outgoing CEO Johan Dippenaar.

Suresh Kalathil appointed senior VP and COO of Guyana Goldfields Canada-based gold producer Guyana Goldfields has confirmed the appointment of Suresh Kalathil as its senior VP and COO, effective March 1st.

Kalathil is a mining engineer with over 25 years of experience working in open pit and underground operations around the world.

“Suresh will be a great addition to our team,” said Guyana’s president and CEO Scott Caldwell.

Karen Wood to become latest chairperson of South32 Female representation within corporate Australia has been boosted by the news that Karen Wood will become the next chairperson of miner South32.

Outgoing chair David Crawford called described the appointment of Wood to lead the South32 board as ‘an excellent choice’.

The election of Wood further swells the number of women at the top rungs of Australian mining companies, with Elizabeth Gaines the current CEO of Fortescue Metals Group.

Nemaska Lithium selects new vice president, operations Robert Beaulieu has been appointed new vice president, operations at Nemaska Lithium, as the Canadian miner approaches a key turning point in its history.

Beaulieu has been overseeing the construction and operations readiness work that will lead to the commissioning of the Whabouchi mine and the Shawinigan electrochemical plant.

“We are truly pleased to welcome Robert to Nemaska Lithium, an incredible talent developed through various Canadian and international experiences,” said president and CEO Guy Bourassa.

Resource Global Network 193

EVENTS Our pick of the top mining, oil & gas and renewable energy events happening around the world in the months to come

Oil and Gas IP Summit February 26-27 London United Kingdom

PDAC 2019 Convention March 3-6 Toronto Canada

International Renewable Energy Congress (IREC) March 26-28 Sousse Tunisia

AWEA Wind Power May 20-23 Houston United States International Mining and Resources Conference + Expo (IMARC) October 28-31 Melbourne Australia

Want to promote your resources event?

Email the editor at editorial@resourceglobalnetwork.com

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