Namibia’s Omitiomire copper project, which was all but stalled several years ago, is now back on track towards development, with its new majority owner, Omico Mining Corporation (Omico), well advanced with a Bankable Feasibility Study (BFS) which is due for completion by year’s end.
Arthur Tassell recently spoke to Mark Sawyer and Mike Stuart, respectively of Greenstone Resources and Omico, to learn more about the project, which has the potential to produce 25 kt/a of cathode copper.
Located about 140 km by road to the north-east of Namibia’s capital, Windhoek, the Omitiomire deposit – part of the Ekuja dome inlier – was discovered by General Mining and Finance Corporation in the 1970s.
It was acquired in 2008 by Australian junior, International Base Metals Limited (IBML), which subsequently spent about US$20 million on the project. It completed around 85 000 m of drilling and (in 2013) a BFS on a proposed small-scale oxide operation, although this was seen as the prelude to a much larger-scale sulphide operation based on treating the ore in a flotation plant.
The company currently driving the project is Greenstone, a UK-based private equity fund cofounded in 2013 by Mark Sawyer, whose previous career included senior roles with Xstrata and Rio Tinto.
Explaining Greenstone’s involvement, he says that since it was established it has funded 13 global projects. “We have always had a bias towards copper projects and in 2019 we decided to make an investment in Omitiomire, which we thought held considerable promise based on our reappraisal of all the prior work that had been conducted.”
The transaction was completed the same year and resulted in Greenstone becoming the controlling shareholder in the project. Omico is jointly owned by IBML (46.3%) and Greenstone (53.7% through an earn-in agreement on completion of the BFS) and is the majority shareholder in Craton Mining and Exploration, the Namibian company which holds the mining licence. A 5% interest in Craton is held by a Namibian incorporated ESG trust and the project is managed by Omico.
Sawyer says that despite investing considerable time and capital in Omitiomire, IBML was unable to bring the project to fruition through its chosen processing strategy. “Their primary focus was on developing a large-scale sulphide project based on treating the ore via a flotation process, but the numbers just didn’t stack up,” he states.
“They were hoping that a small starter project based on the mining of the oxide cap and processing of ore via a heap leach and solvent extraction/ electrowinning (SX/EW) plant would fund the bigger project, but this proved to be unviable as the oxides simply couldn’t cover the cost of the SX/EW.”
According to Sawyer, a turning point for Greenstone in its assessment of Omitiomire was a report buried in the project data and documentation suggesting that the entire orebody might be amenable to leaching and not just the oxide cap.
“This was actually a bottle roll test dating back to 2008 and, while it was inconclusive, it indicated that Omitiomire might be viable after all,” he says. “Subsequent test work in 2021 by Mintek South Africa confirmed that leaching of the sulphides is indeed feasible and our current BFS is therefore focusing on a relatively low capex SX/EW operation, based on the exploitation of the considerable sulphide resource, as well as the oxide material.”
The development base case anticipates the production of 25 ktpa of LME Grade A copper cathode for at least 12 years, targeting only open-pit mineralisation. The project capital expenditure is estimated at about US$250 million, supporting a competitive capital intensity of less than US$9 000 per tonne. Omico anticipates building an acid plant on site and importing sulphur through the port of Walvis Bay.
Chalcocite – predominant copper mineralisation
Mike Stuart, Omico’s project manager, points out that the predominant copper mineralisation at Omitiomire is chalcocite. “This has led to us adopting a chloride leach as this is the most effective method of treating ore of this type,” he explains. “What this means is that a salt brine is added to the ore at the agglomeration stage. The function of the salt is to help oxidise the chalcocite. Then, when you leach with acid you get about 30 to 40% of the copper out within the first month. An advantage for us is that Namibia has no shortage of salt.”
He adds that the method is commonly used in South America to treat chalcocite ores but has never – as far as Omico is aware – been used in Africa. “The method is well understood and very effective,” he says.
Stuart is the ideal person to manage Omitiomire as he is a geologist with a long track record of exploring for – and developing – copper deposits in Africa. Earlier in his career he served as Chief Geologist for First Quantum and participated in the development and construction of the massive Kansanshi copper mine in Zambia and the Guelb Moghrein copper-gold mine in Mauritania.
More recently, he was closely involved with the development of Weatherly Mining’s Tschudi heap leach SX/EW mine (now on care and maintenance) near Tsumeb in Namibia, which has similarities with Omitiomire.
With its involvement in Omitiomire only starting in earnest in early 2020, Omico’s progress was initially slowed by the onset of the Covid pandemic, but the pace has picked up sharply over the past year. A major step forward was the completion of a new mineral resource estimate (MRE) in mid-2022, updating the previous 2013 estimate.
According to the MRE, the deposit – which consists of a number of stacked parallel tabular bodies or ‘lenses’ which partially merge – hosts a measured and indicated resource of 95.8 Mt at a grade of 0.59% Cu for 563.3 kt of contained copper (at a cut-off grade of 0.25% Cu) with an additional 9.7 Mt – equating to 55.1 kt cu – in the inferred category.
The BFS currently underway was launched in November last year and is being undertaken by some of the best names in the industry. The principal consultants are METC Engineering, the engineering, procurement, project management consultant and overall study lead and Bara Consulting, which is responsible for mine planning, costing, and mining equipment selection.
For the first time in years, drilling has also recently commenced at Omitiomire, with Omico reporting in February this year the completion of a 54-hole, 7 192-metre RC drill programme, managed by MSA and directed at upgrading the inferred resource to the measured and indicated category.
Discussing the proposed open-pit mining operation Stuart says it will be a considerable size. “We will initially be stacking up to 300 to 350 kt of ore a month with this increasing to 450 to 500 kt a month towards the end of mine life,” he says. “Overall material movement will be up to 40 Mt a year so we will need a high-capacity haulage fleet consisting of trucks in the 150-tonne payload class.” He adds that since there is no significant groundwater the pit will be free from water ingress, a problem which affected the Tschudi operation. “We do have a typical Namibian ephemeral river passing through the project area, but this will be diverted around the operations area.”
The heap leach, SX/EW route adopted by Omico has many advantages apart from its low capex compared to a flotation plant. “It doesn’t require any energy intensive milling, water demand is only a fraction of what is required for flotation and there is a low environmental impact because no tailings are generated,” Stuart explains. “Moreover, since the final product is copper cathode rather than a bulk concentrate, we reduce transport costs considerably compared to a flotation operation.”
Omitiomire is in a part of Namibia given over to game and cattle ranching. “We are outside of any national parks or heritage areas, so there are very few environmental concerns,” says Stuart. “We also have zero requirement for resettlement as there are no communities living within our project area. Water, of course, can be an issue in Namibia but we have identified an aquifer of about 70 km to the east of the project, which we believe can support our water requirements.”
Peer Review Group
An interesting feature of the project is that Omico has set up a Peer Review Group.
Sawyer says its primary function is to provide Greenstone with an independent view on the development of the project. “Essentially, its members – all seasoned industry veterans –provide support to the project team. They monitor the project against key milestones, provide input on technical designs and assumptions and reviews and offer guidance on identifying key project risks and suitable mitigation measures,” he explains.
An interesting point is whether there is any exploration upside at Omitiomire. “We believe there could well be, both ‘near mine’ and further afield,” says Stuart. “Between our mining licence and exploration licence, we have a 30 000 ha landholding which is largely unexplored. We are about to launch a 3 700 m RC drilling programme to follow up on some significant chargeability anomalies identified by an IP survey which we completed earlier this year, targeting the deposit and potential extensions to the north.”
What the future holds
On the future path for Omitiomire, Sawyer says that once the BFS is completed, the project will be ready for implementation from a technical and engineering point of view. “The challenge, as always, is the funding but already we have had interest from third parties,” he says. “We certainly have every intention of taking Omitiomire into production and Greenstone’s track record in this respect has been outstanding – our portfolio companies have built eight mines in the past 10 years.”
If Omico can get Omitiomire up and running, it will be a welcome development for Namibia which has seen its copper mining industry virtually disappear in recent years.
There are a couple of initiatives underway to revive both Tschudi and Kombat mines but at present there is virtually no primary copper production in the country, although the Rosh Pinah zinc-lead mine does produce some by product copper. The 30 ktpa of copper that Omitiomire could produce is small by global standards, but it would nevertheless put Namibia firmly back on the copper mining map and provide a significant boost to the country’s mining industry.