BNC undertakes feasibility studies

LIVINGSTONE MARUFU

Listed miner, Bindura Nickel Corporation (BNC) is conducting  feasibility studies to determine economic viability for the proposed extension of the lifespan of its various mines  in order to ensure sustainable growth  trajectory, Business Times can report.

The latest development was revealed by BNC MD, Thomas Lusiyano.

It comes after the miner reported underwhelming performance in the year  to March 31, 2023, primarily as a result of numerous operational problems like low ore grade and outdated equipment, which the miner wants to correct to ensure continuity.

“To ensure that the business continues a sustainable growth trajectory, BNC is at various stages towards establishing the feasibility of expanding its future capacity and life of mine. Inbrief, these areTrojan Nickel Mine down dip exploration and redeepening phase II  where further exploration drilling at Trojan Nickel Mine is being carried out, the envisaged outcome of which is to secure additional nickel resources and capacity for the mining of additional ore, leading to an extension of the life of mine.

“Kingston Hill exploration 120m tonnes of ore at a grade of 0.36% nickel, equivalent to 432,000 tonnes of nickel, are expected to be confirmed from this project. The exploration exercise for Kingston Hill commenced in September 2021.Diamond drilling, to confirm the mineralization of theKingston Hill, started in February 2023. The exploration exercise will appraise the project to the pre-feasibility stage which will, in turn, inform the definitive feasibility study.Stakeholder engagements were carried out to ensure the smooth execution of the exploration work and subsequent work on the Kingston Hill,”  Lusiyano said.

He said that the Trojan Hill deposit, a near-mine prospect less than a kilometer from the operating Trojan Nickel Mine Workings, may provide an additional resource of up to 3.2m  tonnes of ore at a grade of 0.40%, or 13,000 tonnes of nickel.

The mine is also embarking on a  BSR slag dump re-treatment  project which would involve the treatment of a slag dump that accumulated at Trojan Nickel Mine since its inception in the 1960s.

The dump contains approximately three million tonnes of slag containing an estimated 7,300 tonnes of nickel, 6,100 tonnes of cobalt and 2,900 tonnes of copper.

“Studies are ongoing to determine the economic viability of extracting the valuable minerals from the high iron content in the slag dump. Also,  Hunters Road, which  is a nickel deposit that is housed under Hunters Road Nickel Mine (Private) Limited, a 100%subsidiary of BNC, is being looked at.

If the ongoing feasibility studies prove that the ore deposit can be mined profitably, then HuntersRoad presents BNC with additional resources for mining and potentially provide additional feed for value-addition activities,” Lusiyano said.

He said smelter and refinery discussions have been held with interested parties onpossible partnerships towards the resuscitation of the plants, with an external evaluator has been engaged to carry out a technical and financial evaluation audit of the smelter plant and the audit findings will guide the company on the amount of capital required to resuscitate the smelter.

The refinery plant was put on care and maintenance in February 2009.

The expansion of the mine’s lifespans comes at a time when the company had a sudden shift in low ore grade from a high grade raising fears that the resources could be depleting.

Bindura suffered a US$18.5m loss in the reviewed period from a profit of US$8.06m realised in the prior comparative period.

The fact that the miner’s current liabilities exceeded its current assets rendered it technically insolvent.

Current assets for Bindura stood at US$25.4m compared to US$38.8m current liabilities and this means the miner could find it difficult to pay its obligations as they fall due.

The mine was adversely affected by low underground mining mobile equipment availability due to obsolescence and production was also negatively impacted by an unexpected change in the ore body, leading to a severe decline in the high grade massive resource footprint,according to  Bindura board chairman, Muchadeyi Masunda  in a statement accompanying financial results.

He said the transition in the mining model from a low-volume, high-grade strategy to a low-grade, high volume strategy, was behind schedule due to the delay in the delivery of ‘new underground equipment’.

This made the transition to be behind schedule due to the delays in the delivery of the new underground mining mobile equipment which is a prerequisite to the realisation of the new mining strategy.

The company experienced additional operational challenges which exacerbated the situation which included the following factors: sub-vertical rock winder (SVR) breakdown, which was declared a force majeure event, resulting in the loss of October and November 2022 production months.

Also limited hoisting capacity due to the damaged SVR bull gear which is expected to be replaced in August 2023 and the SVR Winder continues to run at 60% of its capacity until the damaged bull gear is replaced in August 2023.

The miner suffered rolling  electrical power outages and general grid instability beginning in the month of February 2023, resulting in severe direct production losses, equipment damage, and recovery inefficiencies was also a major challenge.

The ore hoisted during the reviewed period declined 11% to 418,587 tonnes compared to 463,338 tonnes achieved in the prior comparative period. Ore milled stood at 418 020 tonnes, reflecting a 9% lower than 461130 tonnes.Head grade declined to 0.96% from 1.30% for the prior year while recovery efficiency was 77.9% versus 85.0% for last year. Nickel in concentrate production also declined by 37% to 3180 tonnes from the previous year’s 5,082 tonnes.

Cost of production increased by 76% to US$21 841 per tonne from US$12,410 per tonne for the prior year and Masunda said the increase in cost of production was mainly due to the decrease in nickel production, the high cost of maintaining the old and obsolete underground mining mobile equipment and the increase in power tariffs during the year.

In the outlook, the plans are afoot to augment the current fleet in the new financial year by a combination of hiring and acquiring of additional mining equipment.