Metorex's Ruashi ramps up

Ines Schumacher | Mon, 15 Jun 2009 17:19

[miningmx.com] -- DIVERSIFIED miner Metorex has achieved record production at its Ruashi copper and cobalt mine in Democratic Republic of Congo during May after a difficult start to the operation.

Metorex had to raise R922m in a highly dilutive exercise late last year largely because of the cost and time overrun at Ruashi where operational and management issues hampered the project.

Copper production increased by 21% to 1,847 tonnes from 1,551 tonnes in April. Copper output was 901 tonnes in January.

Cobalt production increased by 33% month-on-month to 214 tonnes in May.

“We had a slow build-up at first, but as we go we are seeing a nice big kick-up in copper and cobalt production month to month,” Metorex CEO Terence Goodlace told Miningmx.

Goodlace attributed the rise to increased throughput at the plant. The amount of ore processed at the plant nearly doubled between January and May.

Issues at the plant included mill stoppages and problems related to the pre-leach thickener, which appear to have been largely resolved.

Goodlace said he found it difficult to predict whether the copper price, hovering above $5,000/tonne on Monday, would go up. “We have not established new equilibrium levels for the copper supply and demand. Until such a point, more certainty around the copper price is difficult.”

“As far as the copper price goes, we are largely hedged at this point,” he added.

Metorex is conducting an infill drilling programme at Ruashi, which it started in April and expects to complete at the end of June.

“The results have been positive and support the historical data previously submitted. The drilling has improved the geological interpretation and understanding of the distribution of copper and cobalt,” the company said in a statement on Monday.

Goodlace said the key reason for completing the programme is to move Ruashi’s resources from an indicated to a measured category, giving Metorex more certainty about its depletion schedule.

Goodlace declined to give a production forecast for Ruashi. “Once we have completed the drilling, we will be in a much better position to provide the market with a number around full production,” he said.

Ruashi has a design capacity of 45,000 tonnes of copper and 3,500 tonnes of cobalt per annum.

Metorex is completing a $7.4m sulphuric acid plant at Ruashi instead of relying on imports from Zambia. “It made sense to complete the plant. It lets us be the master of our own destiny. We generate our own acid on the mine site with very little logistics required and there is a cost-saving factor,” Goodlace said.

Metorex estimates the acid plant will be completed in the second quarter of 2010.

Metoex's share price dropped 0.5% on Monday to R3.48 from R3.50.