Tony Manini; Part 228 May 2015 23:45
As Manini observes: “Jelai is unlikely to be a company maker project and as such is not at the forefront of our thinking.”
The focus, as mentioned above, is getting BKM into production as quickly as possible.
Kalimantan is currently sitting on 47mln tonnes of ore at 0.6% copper, with 12mln tonnes at 1% at BKM.
An 80-hole, 6,500 metre drill programme already underway is expected to significantly expand the resource base.
It will also move at least some of the ore through the various confidence categories towards reserve status.
The recent results from exploration work revealed one hole intercepted 2.02% copper over a 14-metre section that started at a depth of just 4.7 metres. Within that there was a six-metre section that graded 3.71% copper.
It is a shallow dipping deposit that follows the contour of a hill and work going forward will concentrate on assessing the potential of the copper mineralisation within the first 50 metres from surface.
To the non-miners this will mean very little. To those in the know, it suggests the strip ratio (i.e. how much soil has to be removed to expose the ore) ought to be extremely low.
In turn the low strip ratio ought to mean low cost of production – assuming the metallurgy works and the grade is economic.
The plan this year is to carry out two rounds of metallurgical test work plus mining studies.
“By the end of this year the whole thing should come together as a scoping level study and assuming that is all positive we will be ready to press the button on feasibility studies next year,” reveals Manini.
The current work programme is likely to cost in the order of US$3mln. It raised US$1.1mln late last December, and the Kalimantan CEO makes no secret of the fact the business will need more cash.
If all goes to plan then BKM should enter the feasibility study phase in 2016.
Management has set its sights on developing a 15-20,000-tonne a year open-pit mine and plant that has room to expand.
The costs of a project of this scale are currently estimated at around US$150mln – in other words small enough to be project-financed and developed in-house.
There is the potential to exploit satellite deposits within 500 metres of the main target that have already shown some early promise.
“The idea is in three to five years’ time the company is a 50,000 tonne copper producer in the Asian region. That’s really the play,” says Manini.
A transformation on this scale would make a mockery of the current share price, which, it must be said, is predicated on past failures.
Kalimantan under former management hitched its wagon to large partners that failed to find the monster deposits they were looking for.
Its fate is now in its own hands and those of Manini and the new team. Let’s hope they can emulate past successes.
Sign In
Follow the stocks
