Johan Ferreira

JOHAN Ferreira’s Khoemacau Copper in Botswana’s emerging copperbelt was doing what it said it would do without serious interruption until May, when two contractors perished in a mine accident which also injured two others. Ferriera was personally stung by the event, describing it as “a terrible shock”. Production was temporarily suspended but quickly resumed, with the mine reaching nameplate capacity of 60,000 to 65,000 tons in copper production during the year. The only other incident for Khoemacau last year was a media report suggesting its owner, Global Natural Resource Investments, was considering the mine’s sale.

A price tag of $1.5bn was mentioned, although given the trajectory of the copper price, there must be questions as to whether now is really the best time. In any event, nothing came of the sale speculation. As far as projects go, Khoemacau is textbook: a long gestation period followed by a seamless production ramp-up. Next up is a possible expansion of the mine to 130,000 tons of copper annually (and five million ounces of silver), which would boost Ebitda to $600m a year from $300m as per its run-rate in October.

A feasibility study is scheduled for this year. If approved, first production from the expanded mine is planned for 2025. There’s also “significant potential” for further exploration on the 4,040km2 Khoemacau property, and there’s no reason why Ferreira’s Khoemacau can’t build out further. Sandfire Resources, the listed Australian firm, is building a copper mine nearby and has made much of Botswana’s emerging role as a next major source of world copper.