Orion Minerals buys out minority shareholders in Jacomynspan nickel-copper resource

ORION Minerals has bought out minorities in the Jacomynspan Project, a nickel-copper resource located about 65 kilometres north of its flaghip Prieska Copper-Zinc Project in South Africa’s Northern Cape province.

The company said in an announcement today that it had exchanged $750,000 worth of Orion shares for control of the prospect’s minority shareholders, Namaqua Nickel Mining Ltd and Disawell Ltd. Orion will own 70% of Jacomynspan whilst its black economic empowerment partners will control the balance in line with South Africa’s Mining Charter III regulations.

“This is a well-timed deal that simplifies the ownership and management structure of the Jacomynspan Project against the backdrop of surging global nickel, copper, PGE (platinum group elements) and zinc prices and a resurgence of global investor interest in exploration for these commodities,” said Errol Smart, MD and CEO of Orion Minerals.

Since starting exploration on Jacobmyspan in 2017, Orion has identified high priority targets that display a type of copper-zinc mineralisation similar in character to the Prieska Copper-Zinc Project, the company said.

Orion recently published updated findings on a bankable feasibility study for the Prieska Copper-Zinc Project which found that production could be increased to 22,000 tons of copper and 70,000 tons of zinc annually over 12 years, instead of a 10-year life of mine as stated previously. However, the capital cost of the project had increased to A$413m from A$378m in order to accommodate technical improvements.

Development of the project has been delayed by the COVID-19 pandemic with construction of the project only likely in the first quarter of next year with first production in 2024. This may coincide with a recovery in the copper market, said Smart in an interview with Miningmx in May.

“In the short-term, there’s going to be pain in the copper market,” said Smart of expectations of global recession as a consequence of the COVID-19 lockdown. “It will take about two to three years before the smelters are seeing the benefit [of a restocked pipeline]. We’ve also seen quite a lot of destruction in the zinc market.”