A report on private investment holding company Jonah Capital’s early-stage exploration drilling programmes at the Kasempa copper project, in north-western Zambia, which have been ongoing since February 2012, was completed last month by local mining consultancy The MSA Group.

The MSA Group principal consultant Mike Robertson tells Mining Weekly that Jonah Capital is currently studying the findings of the report to establish how to best proceed with the project.

Meanwhile, Mining Weekly reported last month that The MSA Group was also participating in fieldwork inputs into the definitive feasibility study (DFS) for Australia-based resources company Blackthorn Resources’ Kitumba copper project, in west-central Zambia, which is currently in its eighth phase.

Fieldwork to support the DFS is expected to be completed by the end of this year, following the optimised prefeasibility study results, which were published in April.

The MSA Group, which has been involved in the project since the start of the second phase in 2006, is providing Blackthorn Resources with a turnkey geological and mineral resources solution, which includes managing the current mineral resource, exploration and geotechnical and metallurgical core-drilling programmes at Kitumba. Additionally, the company is undertaking a reverse- circulation drilling programme for sterilisation and water monitoring purposes to support the DFS.

About 85 000 m of drilling has been completed at Kitumba and in the region around the current mineral resource area, which is also held by Blackthorn Resources and considered highly prospective.

Mining Weekly reported last month that Blackthorn had been granted a mining licence for its Kitumba project.

Environmental Concerns
The MSA Group principal environmental consultant Robin Bolton points out that the enforcement of environmental regulations in Zambia and the Democratic Republic of Congo (DRC) remains a challenge for mining companies operating in those countries.

“One of the main environmental challenges facing mining companies pertains to the efficient management of water resources on site and the disposal of mine wastewater,” he explains.

Bolton has seen several cases in Zambia and the DRC where copper mines do not comply with the local environmental regulations, particularly with regard to the proper treatment of wastewater discharge.

“The wastewater discharge at copper mines can contain high levels of sulphate and chloride, which can negatively impact on the quality of the local water supply if not correctly treated.”

However, he emphasises that local communities are intensifying their efforts to ensure that mines are held accountable for any infringements of environmental regulations.

“This is placing increased pressure on mining companies to ensure that full environmental compliance is adhered to,” states Bolton.

MSA is also in discussions with base metals miner First Quantum Minerals (FQM) about establishing an environmental management system from the earliest production stages for the miner’s Sentinel openpit copper mine, about 150 km west of Solwezi, in north-west Zambia.

“This is to mitigate the mine’s negative impact on the environment as much as possible early on and for the mine to better understand what the project’s environmental risk factors are to avoid challenges arising at a later stage,” explains Bolton.

Sentinel is the first of FQM’s three large openpit mines that will be developed within the mining company’s 300 000 t/y Trident copper project over the next two years.

Copper Climate
There has been a downturn in the number of new copper exploration projects over the past two to three years, owing to the difficulty of securing finance, highlights The MSA Group GM Dr Ian Haddon.

He points out that additional factors, such as the decline of about 7% in the copper price over the past year, coupled with the slowdown in demand from China and strong supply forecasts for copper, have further placed copper mining companies under significant pressure.

Haddon notes that Indonesia has lifted the ban on the export of unprocessed minerals and ore exports, which has been in place since January.

He says that the resumption of supply of Indonesian copper to “an already oversupplied market” is a significant development.

“I expect that copper prices will remain low throughout 2015, which will place pressure on Central Africa’s copper producers to remain competitive,” Haddon highlights.

He further points out that Zambia’s new proposed royalty tax regimes – 20% for opencast mines and 8% for underground mines – which would come into effect from January 2015, are likely to discourage companies from investing in new projects and expanding existing ones.

Moreover, Haddon highlights that Zambia’s government has withheld about $600-million in value-added tax (Vat) repayments from mining companies that failed to provide importer documentation in accordance with Vat Rule 18, which was amended and enforced in September by Zambia’s Revenue Authority.

Zambia copper producers have publically commented that they cannot comply with the provisions of the current Vat Rule 18, as they sell to commodity traders and do not know the final destination of their output.