Finders updates Wetar copper project
Friday, April 29 2011 - 08:55 AM WIB
Wetar Copper Project (FND 95%)
Current Site Activities
The Demonstration Plant stage was concluded with final stripping cycles completed in early January, resulting in sales of 92t of copper cathode in the Quarter. Reduction of plant activities allowed for maintenance in preparation of the re-start planned when permitting is complete.
Site activities focussed on preparations for the start of the commercial project construction phase.
The capacity of the neutralisation plant was extended with the addition of a new filter press, which is sufficient for the early stages of the expanded demonstration plant. To increase crushing capacity, the fabrication and reconditioning of an extra crushing circuit commenced. New stormwater ponds were constructed and installed for environmental management purposes.
Infrastructure requirements for the commercial stage were completed with the refurbishment of the 350-man former mining camp was completed and the port facilities were upgraded.
Permitting
During the Quarter, the Company completed presentations and socialization of the projects? Feasibility Study and Mine Closure and Reclamation Plans with MP?s and government officials and all relevant stakeholders. In addition, the new Mines Department completed a review of documents previously submitted to support the mining permit application. These documents were formally approved at the Regency level (issuing authority) on 15th March 2010.
The newly elected Bupati (Regent) is scheduled to begin his term in late April 2011.
Finders has progressed documentation required to recommence exploration stage work in the north coast tenements within forestry areas to the stage that they are now pending signature. Similarly, work has been undertaken in advance of the application for the construction phase, and a site survey of the forest area has been completed.
In parallel, the Province of Maluku and local Regency, have applied for the conversion forest areas in the Kali Kuning and Meron areas to be released from Forestry Department control and this is expected by mid-year.
Project Development
During the Quarter, Finders Resources approached a number of specialist mining project finance banks in March to formally submit expressions of interest to provide debt for development of the Wetar project. From the responses received, Finders will target to complete a common term sheet and then mandate lead arranger(s) in the second quarter.
In March, the Whim Creek processing facility stored in containers and break-bulk items were transported to Port Hedland. The Whim Creek plant is now ready to be shipped to Surabaya Port in Indonesia as soon as final masterlist (duty exemption) documents are complete; import permits for the plant have already been issued. Timing for shipping is expected to be in the second quarter.
Mining and copper leaching optimisation studies have confirmed that copper can be delivered to the Stage 1 and 2 processing plants at an increased nameplate production of 25,000 tpa of cathode. This is a better match with the capacity derived from the integration of the Expanded Demonstration Plant (Stage 1) and the Main Plant (Whim Creek) to be relocated to the Kali Kunning Valley (Stage 2).
The development schedule has been modified further to account for the time estimated for granting of the permits; previously scheduled pre-development expenditure will be suspended until the mining permit is issued to conserve cash. As a possible consequence, construction and commissioning may take 11 months from the time that the Wetar Project is committed to development. Once the mining permit is issued, the Company will review site activities with view to accelerating this timeline.
The revised Bankable Feasibility Study (BFS) level study for Stage 2 is later than expected due to consultant unavailability and continuing iterations of the mine and production modeling aimed at increasing nameplate to 25,000 tpa copper. This work is now complete and the BFS document is being compiled and finalized and updates on revised capital and operating costs will be available by end of May. A seven year mining period is required to mine approximately 8.2mt of ore from the Kali Kuning and Lerokis deposits at a 0.95 strip ratio. Production of approximately 150,000t of copper cathode over a 9 year processing period is foreseen assuming a 76% terminal copper recovery.
Refinement of the preparation for Stage 1 has also been in progress during the Quarter. All major contractors and equipment suppliers have signed Memorandum of Understandings to commence work on the development of the project and final pricing is under review. The Stage 1 rectiformer is near complete and final shop inspections and load testing is expected in May in the USA and thereafter the unit is ready for shipping to Surabaya.
Finders is pleased to announce the appointment of Chris Allwood to the position of Project Manager for the Wetar Project. He reports to the Company?s Development Director, Rob Thomson. Allwood has qualifications in Project Management and Mechanical Engineering and as a senior project and construction manager has a background which includes multi-disciplinary international projects, ranging from commercial buildings and civil projects to heavy industrial and resource processing facilities.
Recent work includes Principals Representative for Barrick at the Porgera paste backfill plant in PNG (2009-10), Principals Representative for Straits Resources at the Sebuku Coal Processing Expansion plants in Indonesia (2008-9), Construction Manager for the Cibaliung process plant in Indonesia (2007-8) and leading the Ausenco team as Owners Project Manager at the Minara Nickel Heap Leach Expansion Project in Australia (2006-7).
Allwood?s initial focus will be the completion of design and project implementation schedules with Neubau Engineering in Brisbane and then he will oversee the process of relocating project control from Sydney to Jakarta. In Jakarta, a primary role is to complete the buildup of the Indonesian development team and integration of the Wetar Project using Indonesian contractors and suppliers. After this, Allwood will be based on Wetar Island and take charge of the project management of Stage 1 and 2 developments.
Exploration Ramp-up
A review of exploration targets within the northern tenement blocks was completed. The planned program will focus in two areas; Meron, a known satellite deposit located 1km east the of Kali Kuning heap leach pads and Karkopang, located 2km south of the Kali Kuning deposit
At Meron, during the former gold mine area, a total of 85 diamond drill holes were completed to assess the potential of a small gold-silver resource. Underlying the gold mineralisation, is a copper bearing massive sulphide which was partially tested during the same program.
The geology of the prospect area is well known, with outcropping barite sands which host the gold mineralisation, covered to the north by a sequence of lahars. The sulphide is not exposed and Finders completed electromagnetic surveys (EM) in the prospect area, which indicates that the sulphide body maybe be of similar dimensions to that seen at the Lerokis deposit.
The Karkopang Prospect lies 2km upstream from the Kali Kuning deposit. Recent review of airborne EM data from the gold mining era has indicated a number of conductors which have a similar response to the covered massive sulphide at Meron. Local geology is similar to Meron with a lahar cover sequence adjacent to an altered basement sequence exposed in the creeks.
The Company has completed semi-detailed mapping and stream sediment sampling in the vicinity and during the quarter was in the process of completing grids for ground-based surveys. There are encouraging geochemical results, with rock chips up to 0.16% Cu from copper stained altered and very anomalous (for Wetar) stream sediments (BLEG) samples with 5.8ppb Au, 253ppb Ag and 27.6 ppm Cu from rivers draining Karkopang. (end of edited excerpt)