TIDMSML
RNS Number : 8395V
Strategic Minerals PLC
11 April 2019
Market Abuse Regulation (MAR) Disclosure
Certain information contained in this announcement would have
been deemed inside information for the purposes of Article 7 of
Regulation (EU) No 596/2014 until the release of this
announcement.
11(th) April 2019
Strategic Minerals plc
("Strategic Minerals", "SML" or the "Company")
Leigh Creek Copper Mine Recommences Heap Leach Operations at the
Mountain of Light
Strategic Minerals plc (AIM: SML; USOTC: SMCDY), a producing
mineral company actively developing projects prospective for
battery materials, is pleased to announce that its Leigh Creek
Copper Mine ("LCCM") operations have recommenced copper production
at the Mountain of Light processing facility and has, as a result
of drilling, upgraded the estimated JORC copper resource at
Paltridge North by 46% to 10,800 copper metal tonnes. The
recommencement of production has been achieved with the completion
of the plant refurbishment and the trial reactivation of the
existing processing plant and heap leach pads.
Highlights:-
-- First tonne of copper production in a cement product
(approximately 70% Cu) completed at the Mountain of Light
processing plant.
-- Reactivation of existing heap leach pads with the completion
of turning over of the pad material, irrigation with diluted
sulphuric acid, and successful activation of the copper sulphate
solution with iron through the twin Kennecott cones.
-- Targeting to be Australia's largest copper cement producer by mid-2020.
-- Reactivation of the existing heap leach pads fully covered under existing permits.
-- Resource update for the Paltridge North deposit completed resulting in a 46% uplift.
o Indicated Resource: 909,000 tonnes @ 0.80% Cu
o Inferred Resource: 514,000 tonnes @ 0.68% Cu
o Total Resources: 1,423,000 tonnes @ 0.76% Cu.
-- The feasibility study for the commencement of full-scale
production from Paltridge North and Rosmann East, and submissions
associated with government approvals for mining these areas, are
well advanced and scheduled to be completed in Q3 2019.
Commenting, John Peters, Managing Director, Strategic Minerals,
said:
"The production of the first tonne of high grade copper
concentrate, in the form of cement, is a major milestone in the
development of LCCM. At acquisition, in March 2018, a strategic
plan was adopted that set out a low capital cost to re-start
operations, an ambitious time frame to initial cash flows, high
operating margins and upside potential for the copper resources
within the existing Mining Leases.
"The restart of production in 13 months from acquisition has
reinforced the Board's confidence that the acquisition of LCCM will
prove to be a major value added asset for the Company and will
provide significant on-going after tax cash flows from 2020.
"The Board of SML thanks the LCCM team and our engineering
contractors (PPM Global) for the excellent work they have conducted
in restarting production at the Mountain of Light facility."
Refurbishment of the Mountain of Light Processing Plant and
Reactivation of the Heap Leach Pads
The refurbishment and recommissioning of the Mountain of Light
processing facility has been successfully completed with the first
tonne of copper cement concentrate being produced in the second
week of April 2019. The restart of operations at the Mountain of
Light has focussed on:
-- Repairs to pipework, pumps, storage ponds and Kennecott
cones, which had all remained idle since 2012
-- Drilling of existing heap leach pads to test for remnant copper
-- Reactivation of the existing heap leach pads with turning
over the pad materials and reinstalling irrigation lines
-- Purchase of key reagents, namely sulphuric acid and scrap steel
-- Improving of safely walkways and access stairs
The Mountain of Light ("MoL") processing facility is a copper
heap leach and cementation plant that was last operated in 2012.
This was purchased by SML in March 2018as part of the LCCM
acquisition. The MoL plant includes three historic heap leach pads,
pregnant liquor ponds, two Kennecott cones and a filter press, as
well as complete supporting infrastructure (power, water,
communications, access) and is designed to produce a high-grade
copper concentrate (70% Cu) known as a copper cement. Copper is
extracted from the leach solution as a copper cement by reaction
with scrap iron within the Kennecott cones.
LCCM's engineering partners, PPM Global, have successfully
refurbished and recommissioned the MoL processing plant and
re-activated the existing copper heap leach pads as a trial for
later full-scale production. The irrigation of the heap leach pads
commenced on 8(th) April 2019 with initial copper cement production
occurring on the same day.
The trial re-activation of the heap leach pads, including the
commissioning of the processing plant, provides the basis for
production from unmined resources, including the Paltridge North
and Rosmann East deposits. Recent drilling at these sites have
resulted in a resource estimate update (see below). Associated
metallurgical analysis and feasibility studies have been completed,
details of which were announced by SML on 7(th) March 2019.
Paltridge North Resource Upgrade
A new resource estimation has been completed for Paltridge North
including all the latest drilling data and is summarised in Table
1. The resource estimation was undertaken in accordance with the
JORC (2012) guidelines.
The new resource estimate includes a significant increase in
tonnes (from 0.92Mt to 1.42Mt) and contained copper (from 7,400 t
to 10,800 t) from previous estimates. Almost all of the increase is
in the Inferred category (from 200 t to 3,500 t), which is a result
of improved geological understanding of the mineralisation and
judicious use of older (1970's) drilling data to refine and extend
the resource boundaries into areas not tested by more recent
drilling.
Category Mineralisation Tonnes Grade Tonnes of Contained
Type % Cu Cu
Indicated Oxide Zone 633,000 0.75 4,700
Indicated Chalcocite Zone 276,000 0.92 2,500
Inferred Oxide Zone 114,000 0.63 700
Inferred Chalcocite Zone 400,000 0.69 2,800
----------------- ---------- ------ --------------------
Total Indicated(1) 909,000 0.80 7,300
Total Inferred(1) 514,000 0.68 3,500
---------- ------ --------------------
Grand Total(1) 1,423,000 0.76 10,800
---------- ------ --------------------
Table 1 - Paltridge North Resource (0.3% Cu cut-off)
[1] Minor rounding errors may occur
The Paltridge North deposit is a shallow, relatively flat
tabular deposit hosted in a fine-grained siltstone. Approximately
90% of the total resource occurs within 55m of the surface.
Oxide mineralisation occurs as the carbonate minerals malachite
and azurite in the upper levels of the deposit to a depth of about
30m, where it has a relatively sharp contact with secondary
chalcocite zone mineralisation, dominated by chalcocite with minor
native copper.
Rosmann East Drilling
Assay results from six of the seven PQ3 diamond holes drilled at
Rosmann East in January 2019 are now available. The holes were
drilled to test for extensions to existing copper oxide and
chalcocite mineralisation zones beneath the existing open pit. A
total of 675.2m was completed. The drilling is also designed to
provide metallurgical samples and geotechnical information for a
feasibility study on the Rosmann East deposit. The shallow nature
and proximity to the Mountain of Light processing plant makes
mineralisation from Rosmann East an attractive ore source for
initial production.
Results
Assay results for the holes RED18-01 to RED19-06 are now
available and are presented in Table 2. The seventh holes
(RED19-07) is being retained intact to provide reference material
for mining and geotechnical studies.
The holes all intersected broad zones of low-grade chalcocite
mineralisation (with pyrite, chalcopyrite and bornite) to 30m below
the previously defined mineralisation at Rosmann East and 60m below
the existing pit floor. Together with the existing drilling
information, the latest assay results and geological interpretation
has provided an improved understanding of the nature and extent of
the Rosmann East mineralisation, which will enable a new, JORC 2012
compatible, resource estimation to be undertaken.
Hole ID Depth From Depth To Interval Copper Grade
(m) (m) (m) (% Cu)
RED18-01 Total 11 80 69 0.37
Including 11 17 6.0 0.35
Including 31 49 18 0.50
Including 53 70.2 17.2 0.42
Including 72 80 8 0.47
---------------------- ----------- --------- --------- -------------
RED18-02 Total 8 19 11 0.39
Including 9 15 6 0.52
and 25 77.95 52.95 0.18
Including 29 41.5 12.5 0.44
---------------------- ----------- --------- --------- -------------
RED19-03 Total 37.5 73.1 35.6 0.23
Including 38.5 55 16.5 0.34
---------------------- ----------- --------- --------- -------------
RED19-04 Total 39.2 64 24.8 0.30
Including 44.75 64 19.25 0.34
and 71 87 16 0.23
Including 83.1 86.15 3.05 0.41
---------------------- ----------- --------- --------- -------------
RED19-05 Total 49.2 88 38.8 0.36
Including 55 63 8 0.44
Including 69 88 19 0.47
---------------------- ----------- --------- --------- -------------
RED19-06 Total 64 114 50 0.16
including 104 112 8 0.26
---------------------- ----------- --------- --------- -------------
Table 2 - Assay Results from Rosmann East Diamond Drilling
Note: All intervals are downhole.
RED19-07 has not been assayed in order to provide typical core
for viewing and assessment by potential mining contractors and for
ongoing mining and geotechnical studies
Further Work
The new Paltridge North resource model will be used for ongoing
feasibility and mine design studies. Metallurgical testwork on the
samples obtained from the 2018 diamond drilling is ongoing.
A new resource model for Rosmann East is currently in
progress.
Competent Person's Statement
The exploration results in this announcement are based on
information compiled by Mr. David Larsen, who is a Member of the
Australian Institute of Geoscientists. Mr Larsen is the Principal
of D&J Larsen Consulting Pty Ltd and is a consultant to the
Company. He has sufficient experience relevant to the style of
mineralisation and type of deposit under consideration and to the
activity he is undertaking to qualify as a Competent Person, as
defined in the 2012 Edition of the Australasian Code for Reporting
of Exploration Results, Mineral Resources and Ore Reserves and a
qualified person as defined in the AIM Note for Mining and Oil
& Gas Companies dated June 2009. Mr Larsen has over 35 years'
Australia and international experience in exploration, mining
geology and resource estimation for gold, base metals and iron ore
deposits.
Forward Looking Statements
This report contains "forward-looking information" that is based
on the Company's expectations, estimates and forecasts as of the
date on which the statements were made. This forward-looking
information includes, among other things, statements with respect
to the Company's business strategy, plans, objectives, performance,
outlook, growth, cash flow, earnings per share and shareholder
value, projections, targets and expectations, mineral reserves and
resources, results of exploration and related expenses, property
acquisitions, mine development, mine operations, drilling activity,
sampling and other data, grade and recovery levels, future
production, capital costs, expenditures for environmental matters,
life of mine, completion dates, commodity prices and demand, and
currency exchange rates. Generally, this forward-looking
information can be identified by the use of forward-looking
terminology such as "outlook", "anticipate", "project", "target",
"likely", "believe", "estimate", "expect", "intend", "may",
"would", "could", "should", "scheduled", "will", "plan", "forecast"
and similar expressions. The forward-looking information is not
factual but rather represents only expectations, estimates and/or
forecasts about the future and therefore need to be read bearing in
mind the risks and uncertainties concerning future events
generally.
For further information, please contact:
+61 (0) 414 727
Strategic Minerals plc 965
John Peters
Managing Director
www.strategicminerals.net
Follow Strategic Minerals on:
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Twitter: @SML_Minerals
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+44 (0) 20 3470
SP Angel Corporate Finance LLP 0470
Nominated Adviser and Broker
Ewan Leggat
Laura Harrison
Notes to Editors
Strategic Minerals Plc is an AIM-quoted, operating minerals
company actively developing projects prospective for battery
materials. It has an operation in the United States of America and
development projects in the UK and Australia. The Company is
focused on utilising its operating cash flows, along with capital
raisings, to develop high quality projects aimed at supplying the
metals and minerals being sought in the burgeoning electric
vehicle/battery market.
In September 2011, Strategic Minerals acquired the distribution
rights to the Cobre magnetite tailings dam project in New Mexico,
USA, a cash-generating asset, which it brought into production in
2012 and which continues to provide a revenue stream for the
Company. This operating revenue stream is utilised to cover company
overheads and invest in development projects orientated to
supplying the burgeoning electric vehicle/battery market.
In January 2016, the portfolio was expanded with the acquisition
of shares in Central Australian Rare Earths Pty Ltd, which holds
tenements in Western Australia and the Northern Territory that are
prospective for cobalt, gold, nickel sulphides and rare earth
elements. The Company has since acquired all shares in Central
Australian Rare Earths Pty Ltd. In September 2018, the Company
entered contracts for the sale of certain CARE tenements that have
been identified as gold targets.
In May 2016, the Company entered into an agreement with New Age
Exploration Limited and, in February 2017, acquired 50% of the
Redmoor Tin/Tungsten project in Cornwall, UK. The bulk of the funds
from the Company's investment were utilised to complete a drilling
programme that year. The drilling programme resulted in a
significant upgrade of the resource. The 12-hole 2018 drilling
programme has now been completed and the resource update that
resulted was announced in February 2019. In March 2019, the Company
entered into arrangements to acquire the balance of the Redmoor
Tin/Tungsten project in Cornwall, UK.
In March 2018, the Company completed the acquisition of the
Leigh Creek Copper Mine situated in the copper rich belt of South
Australia and is currently working to bring this into operation in
2019.
This information is provided by RNS, the news service of the
London Stock Exchange. RNS is approved by the Financial Conduct
Authority to act as a Primary Information Provider in the United
Kingdom. Terms and conditions relating to the use and distribution
of this information may apply. For further information, please
contact rns@lseg.com or visit www.rns.com.
END
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