RESOURCES giant Kuvimba Mining House (KMH) is set to sink US$50 million on a four-phased extensive exploration programme at its Sandawana mining lease to determine total lithium resources and associated minerals.
KMH, which is 65% owned by the government, took over Sandawana Mines in 2019.
Officials said last week the firm has so far invested US$56 million into the lithium mining project.
Resources at the mine also include tantalite, mica, emeralds, copper and gold.
Once owned by Rio Tinto, Sandawana Mines was one of the world’s largest emerald mines, before it collapsed in 2010.
In an interview with businessdigest during a media tour of the mine, Sandawana Mines general manager Godwin Gambiza said the firm had contracted Chinese and local firms to carry out the exploration.
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“For each phase of exploration, we are looking at no less than US$10 million. Starting with phase one, which is about to come to a conclusion. Already, we have outlaid US$11 million to date to come up with the resource of around 30 million tonnes,” he said.
“We are the first to be able to declare a measured resource. Other players have only been able to declare inferred resources,” he said.
Measured resources represent the highest level of confidence of the presence of minerals as they are determined with extensive sampling and high-quality data.
Inferred resources rely on limited data and carry low confidence levels.
Gambiza said the firm would be commencing phase two of exploration this month, targeting an additional 30 million tonnes of lithium ore.
“By the time we complete all four phases, we would have committed between US$40 million and US$50 towards the exploration campaign. For phase one, up to the 30th of June, we have drilled 374 holes on Block 1, which is the primary focus of phase one so far,” he said.
“Those 374 holes translate to 54 kilometres, drilling to a depth of around 200 metres on average for each hole. But we are not even drilling right up to the termination of the pegmatite itself.
“This is where phase two and subsequent phases will come in because we will then drill deeper holes aiming for up to around 500 metres. “So, what that means is our mining operations will initially start as open pit mines. When we exhaust open pit deposits, will move to underground mining,” he said.
KMH is also set to sink US$250 million in the construction of a beneficiation plant at Sandawana Mines.
Feasibility studies for a 4,5 million-tonne per annum beneficiation plant are underway.
The company commenced lithium open-pit mining operations in January this year.
To date, it has mined and stockpiled over 600 000 tonnes of high-grade lithium ore, valued at over US$216 million.
Based on the resource alone, Sandawana Mine’s valuation now ranges between US$2,5 billion and US$3 billion, according to Gambiza.
Before the asset was taken over by KMH, the mine was considered to have a valuation of less than US$5 million.
The mining lease and claim holdings cover a 21 kilometre-long strip along the Mweza Mountain Range.
Sandawana Mines commenced mining operations in the 1950s as an emerald mine.
It has changed hands over its long history.
KMH is an investment and holding company of mining entities working in special minerals, energy minerals, and base metals acquired the asset.