2.0 Mineral Projects and Exploration Areas
 | Konkola North Copper Project | | Mwambashi Copper Project |
Zambia - Copper Projects
Konkola North Copper Project – TEAL 100%
KEY FEATURES
Project description: The Konkola North Copper Project is a large undeveloped copper resource located within the greater Konkola area of the Zambian Copperbelt. The property consists of a single large-scale mining licence covering an area of 44km2. Existing infrastructure includes a 423m deep, vertical and concrete lined shaft that has an historical hoisting capacity of 1,600,000 tonnes a year. The infrastructure also includes two ventilation shafts and three main access haulage levels,interlinked with several production sub-levels.TEAL has an existing mining licence over the Konkola North property.
Resources: The Konkola North South and East Limb areas host a combined measured and indicated resource of 24.8Mt at a grade of 2.36% copper; and a further 47.7Mt at 1.98% copper is estimated in the inferred category within these areas. Resources relating to the southern portion of the Konkola North property indicate an historical inferred mineral resource estimate of approximately 107Mt (in Area ‘A’) and 63Mt (in Area ‘A’ Extension) at copper grades of 2.30% and 3.88%, respectively.
Ownership level: TEAL currently owns 100% of the Konkola North Copper Project with ZCCM Investment Holdings plc, a company controlled by the Zambian government, retaining the option of buying a stake of up to 20%, 5% of which is a ‘free-carry’.
Accessibility and infrastructure: The Konkola North project area can be reached directly by a national road that is surfaced, in good condition, and connects the town of Chililabombwe, about 11km south of the project, with the village of Konkola, which is adjacent to the project. Chililabombwe and Konkola have estimated populations of 50,000 and 4,000, respectively. The nearest railhead to the project is located in Chililabombwe, situated about 75km north of Kitwe, which has amenities including medical, dental, school, engineering and other services for the mining industry. Cellular and fixed line telecommunications are readily available on most of the Zambian Copperbelt. The village of Konkola is serviced with electricity connections and a 11kV substation is located next to the project. Potable water is available on site.
The Konkola North Copper Project is a large undeveloped underground copper resource located within the greater Konkola area of the Zambian Copperbelt. Within the South Limb, TEAL currently has measured and indicated mineral resources of 11.3 million tonnes at a grade of 2.35% copper, and at the East Limb,TEAL has measured and Indicated mineral resources of 13.5 million tonnes grading 2.37% copper. A further resource of 47.7 million tonnes at 1.98% copper is estimated in the inferred mineral resource category within these areas. These resource estimations were undertaken by Gijima AST, and are based on the previously defined resource blocks. TEAL is presently in the process of redefining these resource blocks,according to more appropriate mining parameters, and will result in the mineral resource estimations for Konkola North being updated.
Previously reported resources relating to the subdivided southern portion of the Konkola North property indicate an inferred mineral resource of approximately 107 million tonnes (in Area ‘A’) and 63 million tonnes (in Area ‘A’Extension) at copper grades of 2.30% and 3.88%,respectively.Previous resource estimations by Gijima AST have identified a total resource for the greater Area ‘A’ of 184.9 million tonnes at copper grades of 2.65%. Additional exploration drilling work is required to increase the geological confidence of these resources and TEAL is currently undertaking an 18,000m exploration drilling program. This drilling is exploring and further defining the high grade intersections returned by previous boreholes in the previously defined Area ‘A’ Extension. Drilling started at the end of the financial year and the first intersection was achieved, as expected, at the end of July 2007. The 18,000m drilling program is expected to be completed in the 2008 calendar year.
Existing infrastructure at the Konkola North South Limb deposit includes a 423m deep, vertical and concrete lined shaft, complete with head-frame, two ventilation shafts and three main access haulage levels, interlinked with several production sub-levels. Geotechnical examination has confirmed that ground conditions are favourable.
The technical aspects of the Konkola North Copper Project feasibility study, based on an operation to exploit the South and East Limb areas of the orebody, have been completed. The study has confirmed the practicality of utilizing the existing shaft to gain access to the orebody by mining first in the South Limb area, followed by the development and mining of the East Limb area. The result is an operation producing 1,250,000 tonnes per annum of run-of-mine (ROM) ore, predominantly utilizing the sub-level open stoping as well as room and pillar mining methods, for an expected build-up to an average production over the 16-year life of mine of 25,000 tonnes of copper (contained in ore) a year. The life of mine production contained in the study is forecast at 17.9 million tonnes of ore grading 2.16% copper. It remains the intention to assess the viability of a dedicated processing facility for
Konkola North and this will be analyzed as a separate project following the completion and approval of the current study.
The Board of Directors has approved expenditure of $1.5 million for the Konkola North Copper Project. These funds will be used to secure long lead items, such as the electrical equipment for the mine winder system, upgrading of the mine power supply and the detailed design of the steelwork sections in the shaft that require replacement. The mining contractor will also be appointed and underground rehabilitation work will continue, which will allow mining to commence as soon as the mine winders have been installed.
Mwambashi Copper Project – TEAL 70%
KEY FEATURES
Project description: The technical aspects of the feasibility study for the Mwambashi Copper Project (Mwambashi) were completed in August 2006, while project development remained subject to a favourable off-take arrangement. The proposed open-pit project is a 12,000-15,000 tonnes per annum copper producer with capital expenditure of $10 million, including contingencies. In addition, preproduction costs, mainly exploration drilling, de-watering of the pit area, and pre-stripping, are estimated at $7.5 million. TEAL has an existing mining licence over the Mwambashi area.
Resources: The mineral resource is estimated at 9.21Mt at a grade of 2.02% copper in the measured and indicated categories, using a 0.5% total copper cut-off.The reserve, estimate used in the feasibility study and for an open-pit mining operation only, amounts to 3Mt at a grade of 2.08% copper. The mining licence area includes Mwambashi and also incorporates three other exploration targets held by TEAL known as the Samba, Pitanda and Mwambashi ‘A’copper prospects. These prospects were explored in the past and historical inferred resources have been defined. TEAL is currently drilling the three areas further to expand the resources and to bring these resources into compliance with National Instrument 43-101.
Ownership level: TEAL owns 70% of the Copperbelt Joint Venture, which includes the Mwambashi Copper Project. The balance of the Copperbelt Joint Venture is held by Korea Zinc Company, Limited (KZC).
Accessibility and infrastructure: The project is accessed by a secondary road, 12km from the paved road, and connects the towns of Kitwe and Chingola. The project is also situated 10km from the nearest railhead located at the Chambishi mine. The town of Kitwe, situated about 35km from the project, has a population of approximately 370,000 and has modern amenities expected of a regional town serving the mines of the Zambian Copperbelt.
The Mwambashi project is located within TEAL’s Copperbelt Joint Venture Exploration Area, a joint venture with KZC. KZC holds a 30% participating interest in Mwambashi and the Copperbelt Joint Venture Area.
The feasibility study for Mwambashi was largely completed in August 2006, and development has remained subject to an off-take arrangement for the treatment of the Mwambashi copper ore, which is primarily oxide-based in the early years of the mine life. Although the process to conclude an off-take agreement advanced over the last year, management has not secured suitable terms to the benefit of the Company. TEAL is now assessing various alternatives.
