Khoemacau Copper Project eyes potential IPO in 2022 following project ramp-up

THE backers of the Khoemacau Copper Project plan to list their investment in about 2022 at which time it will be producing around 60,000 tons a year of the red metal.

“The private equity will want an exit from the project,” said John Munro, the former Gold Fields executive who is an executive director of Khoemacau. “It’s not just one mine,” he said referring to the Kalahari copperbelt in which Khoemacau is situated.

“We are working on the starter project now but the aim is to have one operating mine and a number of projects,” he said of the company when it lists.

The private equity behind Khoemacau, US firm Cupric Canyon, has helped finance the $397m to build the ‘starter project’ which also includes a refurbishment of a concentrator. All in all, finance of $550m was raised last year which also helps refinance existing debt. Cupric Canyon has about 88% of Khoemacau with the balance owned by Resource Capital Fund (RCF), the Canadian investment firm.

Three channels, or mines, are currently under construction and are due to ramp up in 2021. First copper ore will be reached this year, according to Johan Ferreira, CEO of Khoemacau Copper. “Reaching ore is the next milestone,” he said.

“That is about six months down the line. And then, after that, we are looking to build a stockpile of about 100,000 tons by year-end and have the processing facility up and running by about the fourth quarter,” said Ferreira, formerly vice-president of the South African operations at AngloGold Ashanti.

The project is situated virtually in the centre of the Kalahari Copperbelt which runs north east to south west in a band across northern Botswana. Khoemacau is just south of Maun. Supply of infrastructure is not deemed to be problematic – both electricity and water – whilst the support of the Botswana government – though not an investor – is good.

“The objective is to build a safe, mechanised mine which has not been built in the Southern African space,” said Munro. “And it’s also an opportunity to refocus Botswana industry which has been reliant on diamonds.”

As for the copper market, Munro believes that will look after itself. “The long term outlook for copper is such a clean story as there are no new major mines and no very large projects in pipeline,” said Munro.

The project backers had not yet taken a view on where they may list Khoemacau Copper when the time comes.