Significant zircon price increases achieved this quarter. Hydraulic mining capacity successfully doubled to 800 tonnes per hour. Another good safety performance with no lost time injuries (“LTI”) bringing the consecutive LTI free months to 43. Awarded “Flagship Project” status in Kenya’s Vision 2030 economic development framework.
September 2017 Quarter Highlights
|Key Indicator||Unit||Q2 2017||Q3 2017||Variance|
|Ore Grade||% HMC||8.40||8.16|
|Zircon Low Grade Produced*||tonnes||3,026||1,425||(53%)|
|Zircon Low Grade Shipped*||tonnes||10,000||-|
*Zircon low grade tonnes contained in concentrate equivalent to 70-80% of the value of primary zircon.
The quarter was again characterised by continuing improvement zircon markets, ilmenite prices moving up and a positive outlook for rutile.
Ore mined increased from 2.98 to 3.02 million tonnes, but with the mined grade declining marginally from 8.4 to 8.2% as mining of the Central Dune continued.
The staged increase in the throughput of the hydraulic mining unit (“HMU”) progressed according to plan, successfully increasing doubling capacity to 800 tonnes per hour during the quarter. The increase in hydraulic mining capacity has commensurately reduced the demand on dozer mining operations.
The tailings storage facility (“TSF”) sand wall stacking, lining and slimes deposition continued according to plan, with the final wall lift now underway. Once this lift is complete, sand stacking will move to the mined-out area of the Central Dune representing the start of rehabilitation in this section. Rehabilitation of the TSF outer wall continued during the quarter with 15,000 square metres vegetated to date.
Rehabilitation works at the TSF with Mukurumudzi Dam in the background
Moderate rainfall of 252mm was received during the quarter, ensuring the Mukurumudzi Dam capacity remained high at 89% or 7.5 gigalitres of storage ahead of the ‘short rains’ in the December quarter, which should provide a further opportunity to replenish water storage levels.
Rutile production at 22,789 tonnes remained essentially the same as that of the previous quarter, but with recovery up 2% at 100%.
Ilmenite production also remained steady at 119, 376 tonnes with higher contained ilmenite in the feed offsetting the marginally reduced recoveries of 100% (101% last quarter) and lower feed tonnage.
Zircon production increased by a significant 9% to 9,136 tonnes owing to higher contained zircon in feed and a recovery of 75%, up 2% over the prior quarter. Following process optimisation and circuit changes in September, a recovery of 78% was achieved.
In addition to primary zircon, production of a lower grade zircon product (“zircon low grade”) commenced by re-processing zircon tails to produce a zircon rich concentrate. Reported zircon low grade production represents the equivalent zircon content of the concentrate.
Bulk loading operations at the Likoni Port facility continued to run smoothly, dispatching more than 116,000 tonnes of ilmenite and rutile during the quarter. Containerised shipments of rutile and zircon through the Port of Mombasa continued according to plan.
As announced on 4th October 2017, an updated mineral resource estimate for the Kwale South Dune has been completed, incorporating the results of an extensional and infill drill programme completed earlier this year. The updated resource delivered a:
- 19% or 560,000-tonne increase in contained in situ heavy minerals within the Measured and Indicated categories.
- 29% increase in overall mineral resource tonnes to 114.1 million tonnes.
- 13% increase in contained in situ heavy minerals to 3.47 million tonnes.
- Significant increase in confidence with 76% of the heavy mineral tonnage now in the Measured category.
The next phase of extensional exploration drilling at Kwale is anticipated to commence early in 2018 in the North-East Sector, adjacent to the Kwale Central Dune.
Kwale Phase 2 Project (“KP2”)
To offset declining ore grades from mid-2018, and to fully exploit the minerals separation plant (“MSP”) capacity, the implementation of the KP2 Project has commenced.
By increasing mining rates as ore grade declines, the Project aims to maintain heavy mineral concentrate feed to the MSP, and therefore final product volumes of ilmenite, rutile and zircon at around current levels for the remaining life of mine. This will be achieved by increasing the hydraulic mining capacity to three HMUs, each with a capacity of 800 tonnes per hour, along with commensurate increases in wet concentrator plant and water supply capacities. Construction is on track for completion in the June quarter of 2018. The three HMUs will ramp up to full capacity through the course of 2018, with dry mining gradually being phased out over the same period.
It increases the importance of, and value leverage from, potential mine life extensions emerging from the exploration programme that is underway.
Download the full quarterly activities report: Base Resources Quarterly Activities Report - September 2017