FRONTIER Mining is focusing efforts at Benkala Copper Project on improving the production rate and removing remaining operational bottle necks at the SX-EW plant. Partial leaching with forced aeration trials has commenced on Pad 4, with encouraging initial copper content results.
By the end of the current financial year, the company’s ambition is to have Pads 4, 5 and 6 completely stacked to six metres and to begin leaching, which should ensure significantly higher production levels throughout the winter of 2014 and beyond.
Frontier’s management confirms that 1702 tonnes of copper cathode was produced in the 12 month period to December 31, 2013, which was in line with guidance communicated in the interim results in September 2013.
This production was achieved against a backdrop of continual improvement of the various processes to increase production rates, reduce production costs and improve efficiency across the site. In particular, operations were continuous throughout winter despite temperatures dropping to a low of -36 degrees Celsius.
The company has agreed to sell its subsidiary FML Kazakhstan LLP, owner of the Naimanjal licence area, for US$30 million to Union Transnationale Miniere SA (UTM), subject to regulatory approvals in the Republic of Kazakhstan. The Naimanjal licence area is about 200km West of Semey in North East Kazakhstan, with four commercial discoveries covering 529sqkm, including Baitemir, Yubileiny and Beschoku.
The application for approval of the transaction has been submitted to the Ministry of Industry and New Technology of the Republic. The Ministry has the right of first refusal over the asset, where should it decide to purchase the asset, it would have to match the existing deal value.
Frontier’s chairman and CEO Yerlan Aliyev says: “Given the market environment and position of our current financing counter parties, sale of assets was identified as the best method by which to finance capital expenditures at Benkala and pay back existing debts. Whilst the Naimanjal zone was viewed as a good future prospect for our company, we now intend to focus entirely on stabilizing operations at Benkala and developing the South Benkala resource. The proceeds of this transaction will allow us to optimize copper cathode production at the Benkala SX-EW plant, paving the way towards increased production in the near future.”
Exploration programs continue at the Benkala project, including drilling and trenching. Recent geophysical studies completed at Benkala and South Benkala confirmed previous estimates and indicated potential growth in South Benkala resources. Benkala lies about 450km east of Aktobe and some 100km south of Zhitigara in North West Kazakhstan, close to the Russian border. South Benkala is about 10km from Benkala.