Trigon confident of raising Kombat’s profit margins

Trigon Metals, the Canadian company which resuscitated commercial copper production at Kombat Mine in central Namibia on 10 October last year, is upbeat about the profitability of the venture.

Giving an overview of the operations at the biggest copper producer in Namibia, Jed Richardson, the president and chief executive of Trigon Metals, says an increase in production would result in a decrease in costs, translating to bigger profitability.

He says Kombat mine operated profitably from the late 1960s up until about 2007 when 12,5 million tonnes at 2,6% copper came out of the ground, and there are still 12 million tonnes of ore at around 2% copper to be mined.

“There is a lot of life left in this mine, and then a lot of expiration that we’re continuing,” says Richardson, a mining engineer by training, as well as a research analyst.

He says the US$150 million worth of usable infrastructure they inherited at the mine, including a mill that has a 1 000-tonne per day capacity, had given Trigon, whose Namibian partner is renowned deal fixer Knowledge Katti, a head start on getting this asset into production.

Richardson, who was speaking during a webinar towards the end of last year, said once underground production starts, an additional 2 000 tonnes of ore would be produced per day – twice the capacity of the mill.

“We are mining the open pit with an average grade 1,2, heading into our mill operating at 1 000 tonnes per day. We are actively working on dewatering the underground and starting up operations that would add another 1 000 tonnes per day, and we will expand the mill to have a material increase in production.

“So right now, as much as we’re celebrating this production, there’s a lot more to come, so we’ll be producing just under eight million pounds of copper from the open pit annually, and when we get to the underground we’ll grow from that eight to 30 million pounds of copper.

“That’s owing to the doubling of the mill and the doubling of the grade, because we’re 1,2 from the open pit and 2,6 from underground.

“The far west shaft represents a third stage of growth that we’re working on, so once we’re done with the dewatering of shaft one, we’ll be moving one of our pumps to dewater the far west shaft, and we know from past drilling that the grade goes up as we get deeper.

“We’ve got that 2 000 tonnes per day of hoisting capacity, so the ability to grow the whole production to 4 000 tonnes per day, with a lot of it coming from this very high grade material that we are expecting from far west,” he said.

Richardson said returning to the underground would have a massive impact on production levels, and it would bring operating costs down, leading to a big impact on profitability.

“The six months of commercial production we’ll have in our 2024 fiscal year sits at around US$2,95 per pound of copper, and this takes in everything – mining, milling cost and the treatment and refining charges you pay when you’re selling concentrate and having it processed by a smelter,” he said.

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