Rosh Pinah Mine

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Location

Namibia

Ownership

90%

Mine Type

Underground Mine

Resource

Zinc-lead-silver

Operations

  • 2,000-tonne-per-day processing mill
  • Flotation recovery plant
  • Metallurgical and geochemical laboratories
  • Tailings facility
rosh_pinah

Rosh Pinah Mine

The Rosh Pinah underground zinc-lead mine and 2,000 tonne per day milling operation is located in southwestern Namibia, approximately 800 km south of Windhoek and 20 km north of the Orange River, at the edge of the Namib Desert. The Rosh Pinah mine has been in continuous operation since 1969 and currently produces zinc and lead sulphide concentrates containing minor amounts of copper, silver, and gold. The zinc and lead concentrates are transported by road to Luderitz, a port on the Namibian Coast, and then shipped to the international spot markets.

The Rosh Pinah mine is 90% owned by Trevali and 10% by Namibian Broad-Based Empowerment Groupings and an Employee Empowerment Participation Scheme (EEPS).

Geology and Mineralization

The Rosh Pinah Mine is hosted by the Rosh Pinah Formation (Hilda Subgroup of the Port Nolloth Group), forming part of the Neoproterozoic Gariep Terrane deposited onto a Palaeo-Mesoproterozoic basement of granite gneisses and supracrustals.

The base metal sulphides at the Rosh Pinah mine are contained within the approximately 30-metre thick ore equivalent horizon (OEH). In the Rosh Pinah area, the Rosh Pinah Formation has been shown to be at least 1,250 metres thick.

The primary mineralization type of economic interest at the Rosh Pinah Mine is a silicified, grey to dark grey, fine-grained and laminated unit locally called microquartzite mineralization. It consists of alternating millimetre to centimetre wide bands of sulphide exhalites (sphalerite, pyrite and galena + minor chalcopyrite), part of which was carbonatized with associated remobilization and enrichment of sulphides, and is believed to represent a classic reworked sedimentary-exhalative (SEDEX) style exhalite. The secondary argillite carbonate mineralization carries the higher, economic, base metal values. The argillite mineralization would be similarly derived, but diluted with background benthonic argillite.

Mineral Reserve and Mineral Resource Estimates

Rosh Pinah Mineral Reserves as at June 30, 2020


Grade Metal
Category Quantity Mt Zn % Pb % Ag g/t Zn M lbs Pb M lbs Ag K oz
Rosh Pinah Mine
Proven 4.24 7.32 1.99 23.7 684 186 3,221
Probable 6.99 5.62 0.93 16.2 866 143 3,671
Proven & Probable 11.23 6.26 1.33 19.0 1,550 329 6,892

CIM Definition Standards for Mineral Resources and Mineral Reserves (2014) were used for reporting of Mineral Reserves.
Mineral Reserves were estimated at an NSR cut-off value of US$50.0 per tonne.
The NSR values were calculated based on average metal prices of US$1.11/lb Zn, US$0.93/lb Pb, and US$19.81/oz Ag.
The average processing recoveries used were 88.0% for Zinc, 65.8% for Lead, and 43.5% for Silver.
Dilution (Inferred and unclassified material set to zero grade) assumed as a minimum of 1.0 m on each hangingwall and 0.5 m on each footwall.
Mining recovery factors assumed as a minimum of 95%.
Mineral Reserves are reported based on mined ore delivered to the plant as mill feed.
The average exchange rate used was N$ 16.69 = US$ 1.00.
Effective date of Mineral Reserves is 30 June 2020.
The QP for the Mineral Reserve estimate is Mr Andrew Hall, MAusIMM (CP), of AMC.
Rounding of some figures may lead to minor discrepancies in totals.
Mineral Reserves are stated on a 100% ownership basis. Trevali’s ownership interest is 90%.

Rosh Pinah Mineral Resource as at June 30, 2020


Grade Metal
Category Quantity Mt Zn % Pb % Ag g/t Zn M lbs Pb M lbs Ag K oz
Rosh Pinah Mine
Measured 8.13 7.38 2.11 25.7 1,323 378 6,727
Indicated 7.97 7.08 1.22 19.8 1,245 215 5,082
Measured & Indicated 16.10 7.23 1.67 22.8 2,567 593 11,809
Inferred 3.43 6.71 1.34 23.2 508 102 2,557

CIM Definition Standards for Mineral Resources and Mineral Reserves (2014) were used for reporting of Mineral Resources.
The Mineral Resources are stated inclusive of Mineral Reserves. Mineral Resources that are not Mineral Reserves do not have demonstrated economic value.
Mineral Resources are reported at an ZnEq cut-off grade of 4.0%Zn which approximates a Net Smelter Return (NSR) value of $40/t. Zinc equivalency was estimated as ZnEq = Zn (%) + Pb (%) + [Ag (g/t) * 0.028)].
Effective date of Mineral Resources is 30 June 2020.
The QP for the Mineral Resource estimate is Mr Rodney Webster, MAIG, of AMC.
Mineral Resources are stated on a 100% ownership basis. Trevali’s ownership interest is 90%.

Rosh Pinah Expansion “RP2.0” Pre-Feasibility Study

Trevali had positive results from the independent Rosh Pinah Expansion “RP2.0” NI 43-101 Pre-Feasibility Study (“PFS”) at its 90%-owned Rosh Pinah mine in Namibia. The PFS is based on a scenario to expand the current throughput from 0.7 Mtpa to 1.3 Mtpa through the modification of the processing plant, construction of a paste fill plant, and development of a dedicated portal and ramp to the WF3 deposit. All figures are stated in United States dollars on a 100% ownership basis unless otherwise stated. A technical report containing the PFS and prepared in accordance with NI 43-101 will be available on SEDAR within the time frames prescribed under applicable securities laws.

Highlights of the Expansion Pre-Feasibility Study include:

  • Zinc payable metal production of 1.2 Blbs over an 11-year mine life (2020 to 2030) at an average All-In-Sustaining-Cost (AISC1) of $ 0.70/lb.
  • Construction of the expansion project assumed to commence in Q1 2022 and commercial production to be achieved by start of Q1 2023.
  • Post Expansion (2023 onwards):
    • Average annual zinc payable production of 132 Mlbs at an average AISCof $0.64/lb.
    • Average annual lead and silver payable production of 21.8 Mlbs and 286 koz respectively.
  • Proven and Probable Mineral Reserves of 11.23 Mt containing 1,550 Mlbs of zinc, 329 Mlbs of lead, and 6,892 koz’s of silver.
  • Project capital cost of $93 million which includes:
    • Modifications to the existing process plant to include a single stage SAG mill, crushing and ore blending system with a nominal throughput of 1.3 Mtpa.
    • Paste fill plant and reticulation system.
    • Dedicated portal and surface material handling and ventilation systems for the WF3 deposit. 
    • Mine underground infrastructure.
  • Project economics (post-tax) at an average $1.11/lb zinc price, $0.93/lb lead price and $19.81/oz silver price:
    • Net Present Value (“NPV”) @ 8% of $142 million.
    • Free cash flow of $238 million.
    • IRR of 65%.
    • Payback: <4 years

Figure 1: Rosh Pinah Annual Ore Production2 Schedule with Metal Grades

Figure 2: Rosh Pinah Annual Payable Metal Production2 Schedule and AISC1

Rosh Pinah Expansion “RP2.0” Pre-Feasibility Study

Processing Plant: The PFS incorporates an upgrade to the comminution circuit to include a new single stage SAG mill and pebble crusher. The upgrade also includes primary crushing upgrades, an ore blending system, along with other circuit modifications to provide increased flotation, thickening, filtration and pumping capacity to achieve the target throughput of 1.3 Mtpa. The upgrade will also include several flowsheet modifications aimed at improving both the concentrate grade and metal recoveries.

Underground Development and Infrastructure: A dedicated portal and decline to the WF3 deposit will be constructed to support the increase to mine production levels and reduce operating costs. The trucking decline is 3.9 km in length, excluding level access and stockpiles. For construction purposes, the decline is separated into five independent legs to enable concurrent development and reduce overall construction time. Internal legs of the trucking decline will be developed off existing development, with take-off positions selected to minimize interaction with the underground operation.

The new trucking decline will act as an additional fresh air intake within the ventilation network and will enable direct ore haulage from the WF3 zone to a new surface primary crusher station utilizing large-scale (60 tonne) trucks. Ore sourced from other areas (EOF, SF3, SOF, and BME) will be transported to the existing underground crushing system using the existing 30 tonne truck fleet and conveyed to surface via the existing conveying system.

Paste Fill Plant: A paste fill plant has been included to modify the mining method which improves both the safety conditions and economics of the mine. Paste filling the stopes rather that leaving them void will improve ground stability, increase ore recovery, and reduce dilution. It will also reduce surface tailings as a portion of new and existing tailings will be redirected underground to be used as paste fill.

Mobile Equipment: The existing small-scale underground trucks and load-haul-dump (LHD) fleet will continue to be used primarily in the current mining areas. This will reduce capital expenditure associated with purchasing new mobile equipment, increasing development profiles and changing the existing underground crushing and conveying system. As mining extends deeper and average haulage distances increase in WF3, new large-scale trucks and LHDs will be purchased for the more efficient transportation of material to surface reducing costs over the life-of-mine.

Onsite Operating Costs: Once the project is commissioned, onsite operating costs are expected to reduce by approximately 28% on a per tonne milled basis. Mining costs per tonne milled will be reduced due to the change in the mining method to include paste fill allowing for increased ore recovery and reduced mining dilution. Mining costs will also benefit from the dedicated underground decline to the WF3 deposit which will allow for more efficient material handling and reduced cycle times. Except for power, the processing unit costs will decrease as a result of treating increased tonnages following the upgrade. Fixed on site costs on a per tonne milled basis will also decrease as the mine ramps up from 0.7 Mtpa to the PFS target of 1.3 Mtpa as a function of higher annual throughput.

Figure 3 – Representation of Rosh Pinah Expansion “PR2.0”

Future Study Opportunities

Prior to commencing the Feasibility Study in the first quarter of 2021 there are several additional optimization opportunities that are being pursued that have the potential to enhance the projects economics further. The key opportunities are listed below:

  • Optimization of critical underground infrastructure placement including the positioning of the decline and the ventilation, electrical substation, and paste fill distribution networks may reduce mine design physicals and lower capital and operating costs.
  • There is potential for lead recovery improvement with the inclusion of a Jameson flotation cell in a cleaner scalper flotation duty.
  • Inferred Mineral Resources have the potential to be converted to Indicated and Measured Mineral Resources via additional infill drilling work and enable additional higher-value ore (above the strategic optimal cut-off value of $80/t NSR) to displace lower-value ore earlier in the mine schedule thereby improving NPV.
  • Significant exploration potential exists within the Property with a number of high priority drill targets identified to delineate additional Mineral Resources.

Table 1: Life of Mine and RP2.0 PFS Expansion Economics

Project Metrics

Unit

LOM (Q1 2020 – 2030)

Post Expansion

Mine life

Yrs

11

8

Total ore production

Kt

11,610

9,491

Zinc grade (average)

%

6.3

6.2

Lead grade (average)

%

1.3

1.2

Silver grade (average)

g/t

19.1

17.9

Payable Zinc metal

t

544,789

436,260

Payable Lead metal

t

92,606

71,836

Payable Silver metal

Oz

2,685,176

2,074,261

Capital costs – project

US$M

93

-

Capital costs – sustaining

US$M

132

78

Capital costs – closure

US$M

7

7

C1 cash costs1

US$/lb

0.58

0.56

All-In-Sustaining-Cost “AISC”1

US$/lb

0.70

0.64

Post-tax free cashflow

US$M

238

316

Post-tax NPV (8%)

US$M

142

-

Post-tax IRR

%

65

-

Payback Period post-tax

Yrs

3.9

-

Table 2: Expansion Capital Cost Summary in US$M

Item Description

2021
(USD)

2022
(USD)

2023
(USD)

Total

(USD)

Processing

 

Processing plant upgrade

4.1

36.5

4.8

45.4

Mine Infrastructure – Underground

 

 

 

Electrical

0.5

0.4

0.1

0.9

Dewatering

0.1

0.8

-

0.9

Ventilation

0.4

1.6

-

2.0

Other

-

0.4

-

0.5

Mine Infrastructure – Surface

 

 

 

Boxcut / Portal (WF3)

0.6

-

-

0.6

Paste fill plant

-

18.7

-

18.7

Paste fill reticulation

-

3.5

-

3.5

Batching plant (Shotcrete)

-

0.8

-

0.8

General upgrade infrastructure

-

2.2

-

2.2

EPCM

0.7

6.4

-

7.1

Sub-Total

6.4

71.3

4.9

82.6

Contingency (13%)

1.4

8.5

0.6

10.4

Total

7.8

79.8

5.5

93.0

Table 3: Zinc Price Sensitivity Estimates

Financial Metric

Unit

$0.90/lb

$1.00/lb

$1.11/lb

$1.20/lb

$1.30/lb

Post-tax free cashflow

US$M

95

160

238

293

363

Post-tax NPV (8%)

US$M

45

90

142

183

231

1 See “Use of Non-IFRS Financial Performance Measures” below.

2 2020 forecasted production in Figures 1 and 2 is for the full year whereas the Mineral Reserves in Table 5 excludes Q1-2020

3 See “Use of Non-IFRS Financial Performance Measures” below.

4 See “Use of Non-IFRS Financial Performance Measures” below.