Khoemacau, currently the country’s sole producer of copper, put out its first concentrate in June 2021 and has now ramped up to full processing capacity of 3.65 million tonnes per annum, which could yield output as high as 65,000 tonnes of copper in concentrate this year.
The company plans to double its production to 130,000 tonnes by 2026, a figure that would put Botswana within the top 30 copper producers in the world. A pre-feasibility study for the expansion has been completed and the company is focussing on a feasibility this year, whose final results are expected in about 18 months.
“In nine years, we have moved from exploration to production, which is not easy because some projects take 20 years, but even more incredible is our plan to double production in the next two to three years,” Khoemacau CEO, Johan Ferreira told journalists at a briefing on Monday. “These plans are based on studies we have done, including the drilling and others. “We have led the way and there’s a lot of interest in terms of what we have achieved.”
The expansion will involve tapping into three nearby ore-bodies at Khoemacau’s licence area, which will push ore production to eight million tonnes per annum. The company plans to build a new 4.5 million tonnes per annum concentrator to add onto the existing 3.65 million tonnes per annum processor acquired from Discovery Metals’ Boseto Mine.
Like the existing Zone 5 being mined, the new resource being targetted for the expansion will involve underground mining.
The company plans to use the same state of the art mechanised mining approach it uses for Zone 5, at the expanded operations, technologies which involve greater remote control of mining equipment and some processes such as blasting and loading.
Ferreira said in the meantime, it was critical that Khoemacau continue operating at optimal levels in order to prove its project economics and operations, and thereby attract investor support for the planned expansion.
“The financial viability of the business is crucial to be able to sustain ourselves, pay down our debt, as well as monthly costs and get everyone to see that this business is working and that the mine is making money to grow further for the next stage of expansion,” he told BusinessWeek separately. “It’s so important that we get our current operations proper, proving that we can sustainably mine, pay all our costs and pay down our debt so that the future investors can see it as a lower risk.”
Khoemacau was built at a cost of $412 million, after the company raised $650 million in project financing.
Options for funding the expansion include refinancing or approaching the open market.
“Our priority is to show and prove to everyone that current operations and business can be sustainable and viable and that people will then have more comfort in assisting us when we start raising money for the expansions. “It’s about solidifying our current operations and business now and making sure everyone sees that we are doing what we said we would, before we take the next step. “I can’t say the cost of funding will be cheaper because it will still be project funding where margins and risks are always higher. “However, at least the prospective financiers will see that we are a stable company that is operating company and there will be a wider interest to assist in raising debt or capital for that project,” he told BusinessWeek.
