Discovery closer to acquiring mining licence

Brian Benza
Staff Writer | Tuesday June 15, 2010 00:00

In a statement released to shareholders, the London, Australia and Botswana-listed company said it had received the nod from Government after satisfying all requirements for reducing potential hazards of the mine on the environment and the community.

'This achievement places the company one step closer to securing the mining licence from the government and keeps Discovery Metals on track for initial production in December 2011,' the Managing Director, Brad Sampson, said in a statement.

Discovery said the ESIA studies had concluded that all potentially negative environmental and social impacts would be manageable and said management had agreed to a number of impact mitigation strategies contained in an environmental management plan.

Further, it highlighted that no surface water resources of any significance would be impacted on by the development of the two million-ton a year to three million-ton a year mine.

Discovery is planning to start open-cut mining at the project next year with production from the proposed underground Zeta Mine to start in 2014. A bankable feasibility study for the Boseto project would be completed by July.

With a P228 million (A$40-million) cash balance, the company had the funds to progress to the next stages of the project and the placing of deposits on long-lead items, it stated.

Discovery said it expected the project to be greatly beneficial to Botswana, adding that the mine would contribute in excess of P800 million (A$140 million) to the country's GDP in export earnings each year, if production was at the two million-ton a year level.

The project would also create direct employment for approximately 250 people, as well as further indirect and contractor jobs.

Last month, Discovery Metals announced it would increase the capacity of the Boseto copper project by 50 percent to three million tons a year. The announcement came against the background of additionally defined open-cut resources in the Plutus/Petra area and underground mining at the Zeta prospect, which has now been included in the overall project scope.

The company is now accelerating work on Zeta by completing a definitive feasibility study (DFS) for the underground mine. The study will supersede the pre-feasibility work on the Zeta underground mine, which has been progressing since March this year.

The total mineral resource for the Boseto copper project is estimated at around 102,8 million tons at 1,4 percent copper containing 1,2-million tons copper and 57 million ounces of silver.