Modern Mining: Featured News

The US$135 million Bisie tin project in the DRC has now entered the construction phase, with the boxcut providing access to the proposed underground mine complete and work now starting on the decline to the orebody. The new mine, as Modern Mining’s Arthur Tassell reports here, will exploit the richest – in terms of grade – tin orebody in the world and will produce an average of 9 900 tonnes of conflict-free tin annually once in steady-state operation, which is expected to be achieved in late 2019. The project is being developed by Alphamin Resources Corp, a company listed on the TSX-V.

Located in North Kivu Province, 180 km west-northwest of the provincial capital, Goma, on Lake Kivu and roughly 40 km from Walikale, the nearest settlement of any size, Bisie is not just the richest tin (Sn) deposit in the world but the richest by far. Speaking at a recent media round table in Johannesburg, Alphamin’s CEO, Boris Kamstra, said that in the world of tin an orebody grading at 1 % Sn would be considered stellar. “We have an orebody that has a grade of about 4,5 %,” he said. “So we’re not 10 % better or 20 % better or 50 % better than the next stellar orebody but four-and-half-times better. Clearly, this gives us a tremendous advantage.”

Worlds best tin deposit on track for production in 2019

Boxcut construction at Bisie at an advanced stage.

Kamstra added that having tin in the ground did not necessarily make for a profitable mining operation. “One also needs top class people to build and run the operation and Alphamin is privileged to have assembled an extraordinary team. North Kivu is a challenging environment and there are certainly things we have to deal with that other mining companies don’t have to consider. But our people are up to the challenges. It is my firm belief that when this project is completed, everyone who worked on it will never have to write a lengthy CV again. They’ll just put one line – ‘Bisie’ – and they will be given 20 % above the going rate.”

On the subject of security, Kamstra said the widespread perception that North Kivu was unstable and unsafe was out-dated. “The last security incident that we had was in 2014, and the group involved no longer really exists,” he said. He convincingly argued that the Bisie site was in fact far safer than Johannesburg and also pointed out that Alphamin – which operates in the DRC through its 80,75 %-owned DRC subsidiary, Alphamin Bisie Mining SA (ABM) – was receiving excellent support from the authorities, both at national and provincial level. “We have a military curtain between us and the area to the east, which is mainly sparsely populated forest,” he said.

Apart from Kamstra, representing Alphamin at the media round table were Charles Needham, who is the company’s Chairman, and Richard Robinson, Managing Director of ABM. Needham is very well-known in mining circles (he ran Metorex, a group he is still closely involved with, when it was building the Ruashi copper project near Lubumbashi in Katanga) while Robinson, the son of American missionaries, was born in the DRC and is currently based with his family in Goma. He is particularly expert in managing the political and social aspects of mining projects and has worked in the past with USAID and copper miner Freeport McMoRan, which until recently operated the Tenke Fungurume mine in Katanga.

Also present at the round table were North Kivu’s Minister of Mines, Electricity, Small & Medium Enterprises, Industry and Hydrocarbons, Professor Anselme Paluku Kitakya, who was accompanied by Dr Daniel Ngoie Mbayo, the North Kivu Provincial Director of the Ministry of Mines’ Centre of Evaluation, Expertise and Certification.

The Minister expressed his full support for the project and welcomed the prospect of increasing North Kivu’s – and the country’s – tin production. “ABM will double the DRC’s exports of tin by 10 000 tons per year,” he stated. “The mine holds significant value for the region as it brings local and regional employment while adding to the region’s infrastructure and social well-being.” Examples of such value, he said, included the building of the Luuka Primary School at Logu-walikale, a substantial upgrade of the region’s roads and the provision of cell phone connectivity to the area. He noted that through the Lowa Alliance, a not-for-profit foundation established last year by Alphamin in conjunction with local communities, 115 projects had been identified for development over a five-year period. These will be partially financed by a percentage of ABM’s operational expenses.

Robinson told the media at the round table that Bisie used to host an enormous number of artisanal miners – up to 15 000 – at the height of the informal tin mining boom in 2008/09. The introduction in the US in 2010 of the Dodd-Frank regulations (which, among other things, require manufacturers to audit their supply chains and report the use of conflict minerals), as well as the increasing difficulty of accessing the orebody using simple artisanal mining methods, had led to a sharp decrease in artisanal activity from around 2012 onwards.

Said Robinson: “There are now only between 400 and 800 informal miners on site and – after discussions with the authorities – they are probably going to move.” All the miners left are located at the Mpama South deposit (which represents a future expansion of the project) and not the Mpama North orebody, which is where Alphamin will start mining. Ultimately, it is anticipated that the informal miners will move to legal artisanal mining sites which are currently being identified.

Apart from artisanal activity, probably the single biggest challenge that Alphamin faced in its early days at Bisie was the sheer inaccessibility of the site, which is located in mountainous, thickly forested terrain. Over the past year, the situation has improved dramatically with the construction of a 38-km access road. The initial route was cleared using labour-intensive methods (up to 450 community members were employed) and several simple – but beautifully crafted – timber bridges were also erected. This initial track is now being upgraded to meet the demands of mine construction, which will necessitate – once work on the process plant starts – some fairly heavy loads being brought to site.

Technically, Bisie will be a straightforward operation using mining and processing methods which are widely used and well proven, as was detailed in the Definitive Feasibility Study (DFS), completed by MDM Engineering in collaboration with Bara Consulting in early 2016 and updated in June 2016.

The proposed mining method is Sub Level Caving (SLC) to remove the orebody in retreat fashion from the southern and northern limits of mineralisation back towards the centralised trucking ramp. Blasted ore will be loaded by 14-tonne capacity rubber-tyred LHDs dumping into 40-tonne articulated dump trucks and hauled to surface where it will be stockpiled ahead of processing for tin recovery.

According to the recent Front End Engi­neering Design (FEED) programme and associated Control Budget Estimate by DRA Projects, which gives the latest figures, ore will be delivered to the plant at a rate of 25 to 35 kt/month over an initial mine life of 150 months or 12,5 years. A cash margin of some US$11 040 per tonne of tin sold is foreseen, yielding a LoM annual average EBITDA of approximately US$110 million (constant 2017 terms). The project has an NPV (8 %) of US$402,2 and an after-tax IRR of 49,1 %. The projected payback period is 17 months from the first tin production. These figures are based on a tin price of US$17 300/ton, which is well below the current (late August 2017) price of approximately US$20 300/ton.

The process design is based on recovery of tin into concentrate through conventional – and simple – gravity separation methods. Mined ore will be crushed to 100 % passing 10 mm. The coarse material (10 mm to +1 mm) accounts for 75 % of the mass flow and the tin contained in this size fraction will be recovered in conventional jigs. The fine material (-1 mm) makes up the balance of the material and the tin contained in this stream will be recovered using spirals. The concentrates from both the jigs and spirals will be milled and subjected to flotation to remove sulphide material. The tin rich concentrate will be thickened, filtered and dispatched for transport to smelters for further refining.

While the plant – which will have a design capacity of 360 to 400 kt/a with an expected tin recovery of 73 % – will only go into construction next year, the mine infrastructure is on the critical path and an early start has been essential if the project is to come on line and start its production ramp-up in the first quarter of 2019. To this end, Alphamin reported in April this year that it had appointed Kongo River SA and VRSC SARL as the project’s earthworks contractors and Reliant Congo SARL as the Phase 1 mining contractor.

All three contractors have a track record in the DRC, with VRSC, for example, having worked on the construction of Banro’s two gold mines in South Kivu Province, as well as the Kibali mine of Randgold/AngloGold Ashanti in Orientale Province in the far north-east of the DRC. In all, the contractors have deployed 22 heavy earthmoving machines for work at Mpama North and on the access road.

Kamstra described the completion of the boxcut on schedule as an “extraordinary achievement” and also noted that a return airway adit, on which work started last year, had recently intersected the orebody “exactly where we expected”. He said that an airstrip would be put in close to the Bisie camp and added that Alphamin would also be giving attention to the Goma-Walikale road which currently has a section which is in a state of complete disrepair.

Although the project is now well into construction, it is not yet fully funded. Kamstra told the media that Alphamin (which has already spent approximately US$70 million on Bisie), did not anticipate any problem in raising the remaining financing needed and said this process – which would involve both debt and equity in a roughly 50:50 split – could be completed by year end.

Finally, it is probably worth pointing out that Bisie will be commissioned at what appears to be a propitious time for tin demand, with the International Tin Research Institute (ITRI) forecasting a probable global shortfall of the metal beginning in 2018. The ITRI further suggests that tin production from many existing mines and mining regions may have peaked and that a gradual decline may be expected in future years. With Bisie able to produce profitably at prices well below those being achieved at present, the project certainly looks to have a bright future – provided, of course, that the DRC remains reasonably stable, as Alphamin is confident it will.

Report by Arthur Tassell, photos courtesy of Alphamin

Contact Modern Mining

Title: Editor
Name: Arthur Tassell
Email: mining@crown.co.za
Phone: +27 11 622-4770
Fax: +27 11 615-6108

Title: Advertising Manager
Name: Bennie Venter
Email: benniev@crown.co.za
Phone: +27 11 622-4770
Fax: +27 11 615-6108

BANNER 9

 
Full Name*
Invalid Input

Company Name*
Invalid Input

Your Email*
Invalid Input

Phone*
Invalid Input

Postal Address 1*
Invalid Input

Postal Address 2*
Invalid Input

Postal Code*
Invalid Input

Street Address 1
Invalid Input

Street Address 2
Invalid Input

Postal Code
Invalid Input

Town / City*
Invalid Input

Country*
Invalid Input

Magazine

Invalid Input

Invalid Input