Name and Location
Boseto copper operation, Botswana.

Client
Discovery Copper Botswana, a subsidiary of Discovery Metals Limited (DML).

Project Description
The Boseto copper operation is located on one of 18 prospecting licences, covering about 13 500 km2 within the Kalahari Copperbelt – previously a poorly explored extension of the Zambian Copperbelt.

The project consists of two main prospects – Zeta and Plutus.

The current openpit and pending underground operations will feed a three-million-tonne-a-year concentrator for 15 years. Yearly production is forecast at more than 35 000 t of copper and one-million ounces of silver.

Value
The Boseto mine cost $247-million to develop.

Capital expenditure to first ore production at Zeta underground mine is estimated at $5.5-million. Currently the development of the mine is expected to be funded from the announced $110-million investment from Castlepines Global Equities.

Duration
First copper/silver concentrate from Boseto was sold in June 2012.

Underground mining is expected to start from the Zeta in 2015.

Latest Developments
The offer of compromise for the acquisition of the provisionally liquidated Boseto copper operation has been accepted by creditors.

The offer for Discovery Copper has been made by Botswana’s Cupric Canyon Capital, whose subisidiary Khoemacau Copper Mining has been in dialogue with the company as a potential acquirer for the past two years.

The cash-strapped Discovery Copper is part of DML, the shares of which were suspended on the Australian Stock Exchange in February, the month in which the Botswana company was forced into administratorship by lenders demanding immediate repayment of outstanding loans.

When put to a vote as part of a provisional liquidation process being conducted by Deloitte Botswana, Cupric’s offer of compromise won the support of all of the secured creditors, who are claiming more than $103-million; all of the preferential creditors, who are claiming more than P40-million; and 83% of the unsecured creditors, who are claiming nearly $23-million.

Cupric and Discovery Copper were expected to fulfil the conditions precedent ahead of an application to the High Court on June 23.

Key Contracts and Suppliers
Transamine (concentrate offtake agreement) and Standard Bank Chartered, Standard Bank, Credit Suisse and Caterpillar Finance (banking syndicate lead financial arrangers).

On Budget and on Time?
Not stated.

Contact Details for Project Information
Discovery Metals, tel +61 7 3218 0222, fax +61 7 3218 0233 or email info@discoverymetals.com.au; or Discovery Metals Botswana, tel +267 318 0751 or fax +267 318 0752.