Following the completion of basic engineering and procurement, as part of the forthcoming DFS, initial processing plant capacity at the new Kakula copper mine in the DRC has been increased from 3,0 Mt/a to 3,8 Mt/a, boosting projected early-stage copper production. Located 25 km west of the town of Kolwezi in the DRC’s Lualaba Province, Kakula – already well into the development phase – forms part of the Kamoa-Kakula project, a joint venture between Ivanhoe Mines and Zijin.
An LHD scoop tram loads development ore into a 50-tonne truck at Kakula for transport to surface.
The expansion in initial plant capacity will require increasing the underground mining crews in 2020 from 11 to 14 to ensure sufficient mining operations to feed the expanded plant throughput. This will have the benefit of producing a larger surface stockpile of ore prior to the scheduled commissioning of the processing plant, as well as accelerating the mine development schedule, providing the opportunity to bring forward the commencement of the second phase of development at Kakula.
The second 3,8 Mt/a plant module will be fed from the Kakula mine at a planned full production rate of 6 Mt/a. Further study work will determine the amount of tonnes to be sourced from the Kansoko mine, or elsewhere, to maximise the full milling capacity of 7,6 Mt/a. Any plans to accelerate the second module of Kakula’s processing plant would be subject to securing the necessary project-level financing.
Kakula’s original 3,0 Mt/a first processing plant module has already been redesigned during the basic engineering phase to a nameplate capacity of 3,8 Mt/a. Purchase orders have been placed for all major long-lead time mechanical equipment, plant earthworks are well advanced, and plant civil works have started. The contract for the SMPP (structural, mechanical, piping and platework) supply and erection portion of the plant construction has recently been awarded.
The updated estimate of the project’s initial capital cost is approximately US$1,3 billion (from January 1, 2019), which assumes commissioning of the processing plant in Q3-2021. The capital costs incurred by the Kamoa-Kakula joint venture during the first nine months of 2019 were US$182,5 million.
According to Ivanhoe’s latest quarterly report (on the three months to 30 September 2019), the underground development work at Kakula is being performed by mining crews operating large-capacity, semi-autonomous mining equipment, such as jumbo drilling rigs and 50-tonne trucks. More than 5 km of underground development was completed in the nine months ended September 30, 2019.
Development ore is being stockpiled on surface near the site of the concentrator plant. This ore will be used for plant commissioning as well as supplying any gap in the production build-up once the concentrator is operational.
Mine access drives 1 and 2 (interconnected, parallel tunnels that will provide access to ore zones) continue to progress, with access drive 2 having reached the high-grade zone.
The number of underground mining crews has increased from three at the start of the third quarter, to six now working at Kakula. The project will continue to add additional crews over the next 12 months to further accelerate development. Ventilation shaft 1 has been fully commissioned and work on ventilation shafts 2 and 3 is well advanced, with underground access for both having been achieved and pilot drilling started. Construction of the underground rock-handling system (tips, bins and conveyors) is progressing well and is targeted for completion in Q2-2020. Work on Kakula’s main decline dam and pumping station has been completed, and work on the main decline bottom dam is well advanced.
By the end of September 2019, 571 m of development had been completed at the southern ventilation decline, which will facilitate the acceleration of critical early mine development.
Other engineering and construction activities underway at Kamoa-Kakula include the refurbishment of six turbines at the Mwadingusha hydro-electric power plant and associated 220-kV infrastructure to supply the mine with clean hydro-power, construction of a permanent road between the mine site and the Kolwezi airport, construction of the first phase of accommodation for 1 000 employees and contractors, and earthworks for the processing plant and other surface infrastructure.
The scale of the Kakula project is considerable. On February 6, 2019, Ivanhoe announced the results from the Kakula 2019 PFS. The life-of-mine production scenario detailed in the study provides for 119,7 Mt to be mined at an average grade of 5,48 % copper, producing 9,8 Mt of high-grade copper concentrate, containing approximately 12,4 billion pounds of copper.
Based on a consensus, long-term copper price of US$3,10/lb, stage-one production at Kakula is projected to have a grade of 7,1 % copper in the second year of production and an average grade of 6,4 % copper over the initial 10 years of operations, resulting in estimated average annual copper production of 291 000 tonnes. The initial capital cost, including contingency, is estimated at US$1,1 billion. The average total cash cost is estimated at US$1,11/lb of copper during the first 10 years, inclusive of royalties. The project delivers an after-tax NPV, at an 8 % discount rate, of US$5,4 billion and an after-tax internal rate of return (IRR) of 46,9 %. The payback period is 2,6 years.
Kakula is expected to produce a very high-grade copper concentrate in excess of 55 % copper, with extremely low arsenic levels.
Kakula forms part of the overall Kamoa-Kakula project. Earlier this year, Ivanhoe announced an updated independent PEA for an expanded Kamoa-Kakula production rate of 18 Mt/a, supplied initially by Kakula, followed by two 6 Mt/a mines, one at Kansoko and the other at Kakula West, and a world-scale, direct-to-blister smelter.
The very high-grade initial phase is projected to have a grade of 7,1 % copper in the second year of production and an average grade of 5,7 % copper during the first 10 years of operations, resulting in estimated average annual copper production of 386 000 tonnes. Recovered copper production is estimated at 740 000 tonnes in year 12, which would rank the Kamoa-Kakula project as the second largest copper producer in the world.
An independent definitive feasibility study (DFS) for the Kakula mine is underway with an expected completion date of mid-2020. At the same time, Ivanhoe expects to issue an updated preliminary economic assessment for the expanded Kamoa-Kakula combined production scenario that will include an updated Mineral Resource Estimate (MRE)for Kamoa North, including the initial MRE for the Kamoa North Bonanza Zone.
Photos courtesy of Ivanhoe
