Eritrea Bisha pays for itself

By | 2018-09-18T08:32:41+00:00 September 18th, 2018|Global|
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Edited by Leon Louw

Canadian-listed Nevsun Resources and its Eritrean partner Enamco, will self-fund extensions to its Bisha zinc-copper mine in Eritrea.

The planned extension to Bisha’s open pit will add 3.3 million tonnes of high-grade ore to the mill. With the new extension, the current mine life will be extended with another four years, resulting in additional payable production of 470 million pounds of zinc and 52 million pounds of copper over this time frame. In addition to incremental production and revenue, the extension provides time for Bisha to advance assessment of the Asheli and Harena underground deposits and to consider further open-pit extensions.

According to Peter Kukielski, CEO at Nevsun, the Bisha team has been working hard to optimise the mine plan and reduce the operational risk of the deeper ore from the main pit. “The fact that Nevsun will self-fund the extension with proceeds from its current operations significantly increases the long-term cash flow from Bisha, reducing requirements for external funding for construction of our high-grade, high-return Timok Project in Serbia,” says Kukielski.

Nevsun Resources - Map

Bisha is a large, high-grade volcanogenic massive sulphide (VMS) deposit located 150km west of Asmara, Eritrea, East Africa. The Bisha Mine benefits from high-grade base metal reserves, strong support from the Government of Eritrea, and an advantageous location with good local road and port infrastructure.
Image credit: Nevsun Resources

“The extension of the Bisha mine life, combined with the planned ramp-up of the Timok Upper Zone in 2022 and the longer-term potential of the Timok Lower Zone, gives us confidence that Nevsun will continue to produce strong operating cash flows for many years to come,” adds Kukielski.

Kukielski says that the open-pit extension is supported by the now fully implemented metallurgical improvements at Bisha, combined with continued strength in zinc and copper prices. “We will have an additional open-pit extension to consider late next year and are actively evaluating underground mining at Asheli and Harena. We continue to work with our partner, the Eritrean National Mining Company (Enamco), to maximise resource conversion to reserves,” he says.

In August 2017, Nevsun decided to reduce the mine life at Bisha due to the operational risk of the original large open-pit cut-back. Since that time, Bisha has increased mining rates and significantly improved metallurgical performance, while metal prices have remained strong, leading the company to revisit the larger cut-back option. The open-pit extension accesses a portion of the previously envisaged cut-back with an additional 3.3 million tonnes of ore over the existing reserve and assumed recoveries of 70% for copper to copper concentrate and 80% for zinc to zinc concentrate.

Several million tonnes of additional high-grade resource in the original pit design could also potentially be brought back into the mine life. The company expects to assess investment in an additional cut-back to access this resource in late 2019. Approval will depend on performance in delivering the cost targets and increased mining rates for the extension announced recently.

Brief history

The USD250-million Bisha Mine was constructed on time and under budget from 2008 to 2010. Processing oxide ore, the mine produced low-cost gold-silver doré until mid-2013. Through a USD110-million copper expansion project, also delivered on time and under budget, throughput expanded to 2.4 million tonnes per annum (Mtpa) supergene ore and the product switched to copper concentrate.

Commissioning of the zinc expansion plant commenced in June 2016 and commercial production was declared in October 2016. The plant cost about USD77-million to construct, compared to a budget of USD100-million.

The Bisha main deposit is located within the Bisha mining license, and the Harena satellite deposit lies in a separate mining license located six kilometers south, connected by a flat unsealed road. Bisha Main and Harena currently constitute 100% of the mineral reserves for Bisha.

The Bisha VMS District remains underexplored and holds strong potential for expanding mineral resources and reserves for the Bisha mill. The State of Eritrea has a 40% interest in the Bisha Mine through Enamco, 30% of which it bought from Nevsun prior to initial construction. As a result, Enamco contributed 33% of the initial build capital and, as a partner with Nevsun, has been integral to the success of the Bisha Mine.

Mine and plant

Bisha is mined using conventional drill and blast opencast mining techniques to remove waste and deliver ore to the run-of-mine (ROM) stockpile. Mined ore is reclaimed from the ROM stockpile and fed to the conventional single-stage crushing, semi-autogenous grinding (SAG), and then ball mill comminution circuit. The copper and zinc flotation plants are both conventional circuits with rougher, cleaner, and IsaMill regrind. Copper and zinc concentrates are thickened, dewatered, and stockpiled prior to land transport to the Port of Massawa for shipment to world markets. Tailings are pumped and placed in the lined tailings management facility (TMF) at site.

Power is currently provided to the Bisha plant by a fleet of dedicated diesel generators managed by Aggreko. Nevsun recently signed a long-term power agreement with Aggreko to supply the mine with a combination of diesel and solar power. Water is sourced from pit dewatering, the tailings pond, and from local well fields.

Export infrastructure

Concentrate is being exported using a proven system with industry-leading environmental controls. At present, concentrate is loaded from the mine site stockpiles into custom-sealed shipping containers and transported to the Port of Massawa by truck. The sealed containers of approximately 35t each, including the weight of the container, are stockpiled in Massawa at the container port facilities awaiting bulk ship arrivals. The Rotainer crane system then discharges the containers through a tipping 360-degree rotation into the hold of the bulk vessels, and the empty containers are returned to Bisha for reloading. The bulk vessels deliver the concentrate to smelters worldwide, typically in 11 000-tonne parcels.

The Bisha Main deposit is a high-grade VMS deposit. It is configured in three distinct layered zones: a 35m-thick surface gold-silver oxide zone (mined out in mid-2013) immediately overlying a copper-enriched supergene zone, which itself overlies a primary sulphide zone containing both zinc and copper.