- Implementation of an agreed and jointly funded work program to complete a PFS and required permitting.
- CMC granted an exclusive option to develop the North Portia Copper-Gold deposit.
- Exclusive option expires on 30 June 2018 to enter into a development agreement on terms to be agreed.
- Important positive step forward in execution of Havilah's Copper Growth Strategy.
The management teams of both CMC and Havilah consider that there are many potential advantages in this logical next step in development of the Portia district having regard to the extensive shared experience gained through mining Portia over the last three years. This knowledge and the infrastructure already in place means that there will be considerable efficiencies that can be applied to the development and operation of North Portia.
Under the exclusive option, CMC will have until 30 June 2018 to enter into a development agreement for North Portia on terms to be agreed. During the exclusive option period, CMC and Havilah have agreed on a shared work program that is designed to provide the key information to assist CMC and Havilah to determine a mutually acceptable arrangement that will result in the development of North Portia, namely:
1. The parties will jointly undertake the completion of a pre-feasibility study (PFS) and detailed mine design.
2. CMC will be responsible for funding and engaging the relevant technical specialists to complete the detailed metallurgical testwork on drillcore samples and process design studies.
3. Havilah will be responsible for funding and delivering a JORC Measured and Indicated Resource, the independent verification of the North Portia copper-gold resource, and for securing all permitting required.
The timing of the objectives of this work are:
- Complete the PFS by the end of June 2018.
- Negotiate and agree on a development arrangement for North Portia by the end of June 2018.
- Commence overburden removal at North Portia by July 2018.
The initial mining target will be approximately 5 million tonnes of free digging secondary saprolite gold and copper-gold material above 150 metres depth. It is expected that all of this material will be able to be processed in the Portia gold plant, with the addition of a flotation circuit to recover the finer free gold and the copper sulphides.
Commenting on the future co-operation for the advancement of North Portia, CMC Managing Director, Mr Steve Radford, OAM said: "We are very excited to be at this point with Havilah entering into a MOU for the advancement of the copper gold deposit at North Portia.
"CMC is honoured to be involved with this new project and has proven to Havilah that it can deliver excellence and has the ability to take North Portia to the next level.
"CMC are passionate to deliver positive outcomes for not only Havilah and its shareholders, but also Broken Hill, surrounding communities and other stakeholders.
"The opportunity for CMC to develop North Portia made perfect sense after having laid such a solid successful foundation already working with Havilah on the current Portia Gold Mine.
"We intend to build upon and value add to the infrastructure we currently have on site, whilst using the vast knowledge and learnings from the many challenges faced and overcome so far to drive further mining opportunities. "It is suggested that North Portia may have a ten year mine life (subject to completion of a PFS and an independent verification of the North Portia copper-gold resource) which we will incorporate in the mining and processing of the North Portia ore.
"CMC see's Havilah's "Copper Growth Strategy" as a timely opportunity with the global demand for certain commodites set to increase .
"Should the North Portia PFS show favourable signs then we will make it happen because that's what we do", he said.
Commenting on the North Portia MOU, Technical Director, Dr Chris Giles said: "We think it makes a lot of sense for CMC and Havilah to jointly conduct the PFS for the development of North Portia.
"We both have a lot of hard won knowledge from the Portia operation that is directly applicable to North Portia and which will greatly enhance our planning and execution ability.
"The site infrastructure established for Portia, such as the processing plant, camp, workshop and many other assets, can be used for North Portia and will save considerably on capital expenditures.
"CMC have proven themselves to be very competent mine and plant operators and they would certainly be capable of developing and operating North Portia.
"The Portia open pit itself might prove to be of considerable benefit as an environmentally acceptable storage area for the North Portia sulphide tails and waste.
"The impetus that will be given to North Portia via this MOU we see as one of the key steps in the execution of our Copper Growth Strategy ", he said.
About North Portia
North Portia contains a JORC Indicated and Inferred Resource estimate of 11.3 million tonnes of 0.89% Cu, 0.64 g/t Au and 500 ppm Mo (refer to ASX announcement of 23 November 2010), based on Havilah's resource drilling that followed up on Pasminco's discovery drilling. The deposit consists of a primary chalcopyrite dominant sulphide zone below about 150 metres depth with encouraging earlier Pasminco diamond drilling results that include 74 metres (true width) of 1.06% copper and 1.2 g/t gold.
Above this occurs a secondary enriched zone of copper and gold mineralisation in saprolite material that has been the objective of Havilah's drilling over the last eighteen months in order to improve confidence in this part of the resource and elevate it to Measured status. A re-estimate of the resource will be completed once latest drilling results are received, but present indications are that there is of the order of 5 million tonnes of economic grade gold and copper-gold material above this level, which will be free digging. This drilling has clearly delineated a gold enriched cap that sits on top of the underlying copper sulphide mineralisation, which can be processed in the existing Portia gold plant, with some upgrades to recover the finer free gold that is present.
The secondary copper sulphide mineralisation is dominated by chalcocite. Owing to the high abundance of fine clay component it has been found that an initial de-sliming step can reduce mass of material by 50% for negligible loss of copper, which would reduce The additional definitive metallurgical work based on drillcore samples that is planned to be conducted with CMC is designed to produce a fully costed process flow sheet.
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About Havilah Resources Ltd
Havilah Resources Ltd (ASX:HAV) is a debt free South Australian gold producer having recently financed and developed its first gold mine at Portia in north-eastern South Australia. It plans to follow on with three copper-gold-cobalt mining developments at North Portia, Kalkaroo and Mutooroo, which are underpinned by a JORC resources mineral inventory of over 1.4 million tonnes of copper, 3.6 million ounces of gold, and 18,000 tonnes of cobalt.
Chief Executive Officer
Havilah Resources Ltd