Investment partner for Berg Aukas
China Africa Resources plc is seeking an investment partner for its Berg Aukas mining project to revitalise operations. This follows a pre-feasibility study conducted in 2014 which yielded positive results for the prospective mining project. China Africa Resources is a joint venture company which consists of Jiangsu based ECE and Weatherly plc.
The Economist was able to establish through Weatherly’s consulting agency, Blytheweigh, this week that a total of N$120 million for dewatering and rehabilitation works at the underground Berg Aukas mine, will be required.
Said Blytheweigh “the next stage in the development process is to complete a bankable feasibility and, in order to do this, the mine would have to be dewatered. This was estimated at a cost of around N$120 million and will take approximately 18 months to complete.”
Results emanating from the pre-feasibility envisage an operation producing on average 20,000 tonnes of zinc concentrate and 10,000 tonnes of lead concentrate annually with a life of mine of at least 10 years and would employ around 400 people directly, according to Weatherly.
Said Blytheweigh “the next stage, dewatering and rehabilitating the underground mine, has to be completed before conventional financing is available. This makes it a difficult project to finance in the current market, but the company remains confident that the money will be raised and the project will proceed to the next stage.”
Part of the work that needs to be done would also include accessing some of the key production levels to verify the reserves and quantify the costs involved in rehabilitating the mine, said Weatherly Chief Executive Rob Webster in response to queries made by the Economist last year on the intended development at the old Berg Aukas mine. “Unhindered fulfilment of the set objectives would also allow Weatherly to implement final plant design”. Added Webster, “ if all stages proceed as planned, the mine could be fully operational in 2 to 3 years.”
The mine closed in 1978 and significant resources remain unexploited. The majority of the remaining resource is located in areas of the mine where extensive development is in place, providing good access to the ore body. Weatherly plc owns a 25% stake in the mine, ECE owns 65% while the remaining 10% belongs to unnamed investors.