Frontier Mining says a steady improvement in the performance of its Benkala copper mine in Kazakhstan means it is now covering production costs and overheads. It is the first time in Frontier’s history that copper production has generated sufficient cash that allows self-sufficiency of operations.
Benkala has been dogged by operational issues since commissioning, but recent improvements to the processing arrangements mean crushing and stacking is running at a record rate.
“Issues affecting percolation of the pads have now been identified and in some cases rectified via the mixing of different permeability ores, with further enhancements to take effect on an on-going basis,” company officials say.
Benkala produced 1386 tonnes of copper in the 10 months to end-October at an average preliminary cash cost of US$3724 per tonne against an average sale price of US$6979 per tonne. Of that, 919 tonnes have been produced since July with 780 tonnes shipped. Cash generated from sales this year has totalled US$10 million.
Frontier recently appointed metallurgical consultant Adam Moroney to study how best to set up the leaching operating, especially for the freezing winter conditions in Kazakhstan. He has now compiled an operational guide on how to optimize performance and heat retention in winter conditions.
Adam Moroney said, “It will be necessary for Benkala to implement the best-practice operating procedures that are being provided for the freezing conditions that prevail during their winter time. I see the 2013/2014 winter season as probably the most important production-testing period for Benkala; the opportunities to learn from this season can be taken to optimize ongoing year-round operating practices.”
Frontier has also been granted some leeway by its banks with Sberbank agreeing to defer capital repayments on its loan until autumn 2014, with two other lenders also agreeing to extensions. Educational Funds has agreed to roll over its loan notes until the second quarter 2014, while Red Kite has agreed a scheduled repayment of its loan until the end of 2104.
Frontier says that exploration is continuing at all of the company’s projects, with more than 6100 metres drilled and 19,000 square metres of trenching completed in 2013.