Name of the Project
Okiep copper project (OCP).

Location
Northern Cape, South Africa.

Project Owner/s
New Okiep Mining Company comprising Orion Minerals (56.25%) and the Industrial Development Corporation of South Africa (IDC – 43.75%).

Project Description
A scoping study completed in May 2021 has proposed a proof-of-concept-scale copper mining operation at the brownfield OCP, and has confirmed that the project’s deposits have the potential to be mined at low cost using openpit and underground mining methods.

The outcome of the scoping study, based on five initial deposits, supports the economic merit of developing a foundation-phase mining operation, while Orion conducts the required work and engineering studies to evaluate the potential to re-establish mining operations.

The life-of-mine for the proof-of-concept foundation phase is modelled for 12 years, during which concurrent exploration and mine expansion scenarios will be planned and potentially implemented.

The proposed foundation-scale mining operations could run at a design processing plant throughput of 780 000 t/y, resulting in 9 000 t/y of copper sold in marketable concentrates. This could potentially supplement the 23 000 t/y of copper production planned from Orion’s flagship Prieska copper/zinc project.

Only mineral resources from the Flat mines area of the greater Okiep Copper Complex are incorporated in the foundation-phase plan, leaving significant potential for future expansion scenarios to be considered.

Underground and surface mining methods will be used in conjunction with mineral processing using conventional froth-flotation concentration to produce the copper concentrates for export.

The proof-of-concept phase of the proposed operation targets the development of only those Okiep copper deposits for which Orion has verified and reported mineral resources during the early phase of the due diligence period. The milled production target comprises measured mineral resources of 33%, indicated mineral resources of 46% and inferred mineral resources of 21%.

Potential Job Creation
Not stated.

Net Present Value/Internal Rate of Return
The project has a pretax net present value, at a 10% discount rate, of R1.9-billion and an internal rate of return of 44%, with a payback from first production of 3.25 years.

Capital Expenditure
Peak funding is estimated at R643-million.

Planned Start/End Date
First production is possible within 16 months from the start of construction.

Latest Developments
Orion Minerals has made progress through its acquiring a controlling interest in the Okiep copper project.

Orion and other relevant parties, barring the IDC, which is still finalising in-house approval, have signed addendums to amend the agreements that will affect Orion’s controlling interest.

Once the IDC has obtained its required approvals and signed the addendums, Orion can submit the final application for regulatory approval in respect of the first phase of transactions.

Orion exercised an option in 2021 to directly acquire the mineral rights, mineral data, rehabilitation guarantees, any contracts and any other assets held by Southern African Tantalum Mining, Nababeep Copper Company and Bulletrap Copper related to Okiep, rather than acquiring shares in the entities themselves.

The sale assets will be acquired by two Orion subsidiaries – New Okiep Exploration Company, which is wholly owned by Orion, and New Okiep Mining Company (NOM), which is 56%-owned by Orion and 43%-owned by the IDC.

Considering that each entity has different shareholders, the transactions are divided into three separate transactions.

A remaining purchase consideration of R59-million, or A$4.8-million, remains payable by Orion. The first phase settlement comprising R10-million in cash and R35-million in Orion shares will be completed immediately, following approval by certain South African authorities.

Orion MD and CEO Errol Smart is pleased to have finally received confirmation that the majority of the outstanding conditions have been fulfilled for the company’s acquisition of the Okiep mineral rights since the deal started in 2021.

“While we have been able to continue operating on the properties and progressing the project, we have now moved to finalise the Flat Mines bankability feasibility study (BFS) on the NOM mining right,” he has stated, adding that the company awaits approval of a water-use licence before the project is fully permitted.

The company is also awaiting the results of confirmation drilling and metallurgical testwork under way, the results of which are expected to be concluded by June. This testwork will help inform the BFS.

Okiep has a mineral resource of 12-million tonnes grading 1.4% copper for 159 000 t of contained copper. The resource estimate covers an initial six deposits and is based on a detailed review of historical drill data and subsequent geological modelling.

Orion sees potential for further expansion of the resource through its own exploration, since only mineral resources from the Flat Mines area of the greater Okiep copper complex are incorporated in Orion’s foundation-phase plan.

Key Contracts, Suppliers and Consultants
ALS Chemex (core sample analysis).

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