Orion Minerals shares surge on study at Okiep
JOHANNESBURG - JUNIOR copper producer Orion Minerals traded almost 7 percent higher on the JSE after it said the results of a scoping study had confirmed the economic potential for developing a small scale mining operation.
The scoping study was a preliminary technical and economic study of the potential viability of the Okiep Copper Project in the Northern Cape.
Managing director and chief executive Errol Smart said yesterday that based on the strength of the scoping study results, Orion was now pressing ahead to complete final due diligence programmes at Okiep, with a final decision on the project acquisition to be made by the end of July.
“The outcome of the Scoping Study supports the economic merit of developing a foundation phase mining operation while Orion conducts the required work and engineering studies to evaluate the potential to re-establish mining operations with outputs as were previously sustained for decades by previous owners. Newmont managed to produce 30 000 to 40 000 tons per annum of copper,” said Smart.
Smart said the strong copper price environment would serve as an added boost for the project.
“Given the current strong copper market conditions and the potential for further price escalation given very firm global demand fundamentals, we believe the potential for early profitable production from a small-scale foundation phase is very encouraging – particularly given the Scoping Study assumes a conservative copper price of $7 600 (R109 319) per ton compared to recent prices of over $10 000 a ton,” he said.