ORION MINERALS LIMITED – Mining rights granted for the Flat Mines area of the Okiep Copper project, Northern Cape, South Africa – SENS
Mining Right granted for Flat Mines Area of Okiep Copper Project, Northern Cape, South Africa
Orion Minerals Limited
Incorporated in the Commonwealth of Australia
Australian Company Number 098 939 274
ASX share code: ORN
JSE share code: ORN
Mining Right granted for Flat Mines Area of Okiep Copper Project, Northern Cape, South Africa
Grant of the Mining Right by the South African Department of Mineral Resources and Energy marks a
major milestone in the development of the Okiep Copper Project.
Mining Right enables confirmation drilling and metallurgical sampling, required for completion of the
advanced stage bankable feasibility study.
Orion’s Managing Director and CEO, Errol Smart, commented:
“The grant of the SAFTA mining right is a major step forward for Orion and our objective of early production of
copper and other Future Facing metals, while continuing to expand our Mineral Resources and beneficiation
capacity in the Northern Cape, South Africa.
Our bankable feasibility study on the granted mining right area is at an advanced stage and can now be
completed with access to the property for bulk sampling and final confirmation drilling purposes.”
Orion Minerals Limited (ASX/JSE: ORN) (Orion or the Company) is pleased to announce that a Mining Right has
been granted over the key Flat Mines area, that lies at the core of the Okiep Copper Project (OCP) (Figure 1).
The Mining Right granted, to Southern African Tantalum Mining (Pty) Ltd (SAFTA) under the Mineral and Petroleum
Resources Development Act, is valid for an initial period of 15 years and can be renewed on application for a
further period which may not exceed 30 years.
Figure 1: Location of the OCP mineral rights and SAFTA Mining Right (MR).
Orion has completed a positive Scoping Study (refer ASX / JSE release 3 May 2021; summary in Appendix 1) for
the Flat Mines SAFTA area, which demonstrated the economic merit of developing a foundation phase mining
operation at the SAFTA properties. The Scoping Study supported a moderate scale start up mining operation on
known, drilled copper deposits. Orion’s aspiration, with project partner the Industrial Development Corporation
(IDC) is an early re-establishment of mining operations on the brownfields site, while conducting the required
work and engineering studies to support the longer term goal of achieving production at a similar scale to past
owners Newmont and later Goldfields under the Okiep Copper Company (Figure 2).
Figure 2: Okiep Copper Company production from 1940 under past ownership.
The grant of the Mining Right follows Orion’s announcement on 2 August 2021 that it had exercised its restructured
option (OCP Option) to acquire a controlling interest in the majority of the properties that form the OCP. The
OCP Option was granted to Orion by each of SAFTA, Nababeep Copper Company (Pty) Ltd (NCC) and Bulletrap
Copper Co (Pty) Ltd (BCC). These entities hold the majority of the large, historical mines in this significant copper-
producing district, which has produced more than 2Mt of copper metal over a 150-year period to 2003.
Orion announced on 16 September 2021, that the IDC had signalled its intention to remain a key strategic partner
in the SAFTA project and work with Orion in the development of the New Okiep Mining Company (NOM), that
will acquire, the assets owned by SAFTA, which is currently 43% owned by the IDC. The shareholding in NOM will,
in the future, include Orion as majority owner with 56% holding, the IDC as key strategic partner and historically
disadvantaged empowerment partners in compliance with the requirements of the Mining Charter 2018. This
includes a 5% participation by each of the host community and employee trusts.
The OCP is a significant growth opportunity for Orion, with the potential to become a second base metal
production hub for the Company in the Northern Cape, alongside its flagship Prieska Copper-Zinc Project,
located 450km east of the OCP.
The grant of the Mining Right represents a major step towards the development of the OCP and clears the way
for final engineering studies, Mineral Resource upgrade, drilling and bulk sampling for metallurgical optimisation.
Feasibility studies upgrading the 2021 scoping feasibility study (refer ASX / JSE release 2 August 2021) for the OCP
are well advanced, with targeted completion early 2023.
About the IDC
The Industrial Development Corporation (IDC) of South Africa Limited was established in 1940 by the Industrial
Development Corporation Act, 22 of 1940 and is wholly owned by the South African government. IDC priorities
are aligned with the national policy direction set out in the National Development Plan (NDP) and industry
masterplans. The IDC mandate is to maximise development impact through job-rich industrialisation while
contributing to an inclusive economy.
For and on behalf of the Board
Managing Director and CEO
29 August 2022
Investors Media JSE Sponsor
Errol Smart – Managing Director & CEO Nicholas Read Monique Martinez
Denis Waddell – Chairman Read Corporate, Australia Merchantec Capital
T: +61 (0) 3 8080 7170 T: +61 (0) 419 929 046 T: +27 (0) 11 325 6363
E: [email protected] E: [email protected] E: [email protected]
This release may include forward-looking statements. Such forward-looking statements may include, among other things,
statements regarding targets, estimates and assumptions in respect of metal production and prices, operating costs and
results, capital expenditures, mineral reserves and mineral resources and anticipated grades and recovery rates, and are or
may be based on assumptions and estimates related to future technical, economic, market, political, social and other
conditions. These forward-looking statements are based on management’s expectations and beliefs concerning future
events. Forward-looking statements inherently involve subjective judgement and analysis and are necessarily subject to risks,
uncertainties and other factors, many of which are outside the control of Orion. Actual results and developments may vary
materially from those expressed in this release. Given these uncertainties, readers are cautioned not to place undue reliance
on such forward-looking statements. Orion makes no undertaking to subsequently update or revise the forward-looking
statements made in this release to reflect events or circumstances after the date of this release. All information in respect of
Exploration Results and other technical information should be read in conjunction with Competent Person Statements in this
release (where applicable). To the maximum extent permitted by law, Orion and any of its related bodies corporate and
affiliates and their officers, employees, agents, associates and advisers:
• disclaim any obligations or undertaking to release any updates or revisions to the information to reflect any change in
expectations or assumptions;
• do not make any representation or warranty, express or implied, as to the accuracy, reliability or completeness of the
information in this release, or likelihood of fulfilment of any forward-looking statement or any event or results expressed or
implied in any forward-looking statement; and
• disclaim all responsibility and liability for these forward-looking statements (including, without limitation, liability for
OCP – Flat Mines Pilot Project Scoping Study
Price and Forex Assumptions Unit Value Financial Performance Unit Value Unit Value
Metal price – Cu USD/t 7,593 NPV (pre-tax) approximated @10% discount rate ZAR (M) 1,896 AUD (M) 170
Metal price – Au USD/oz 1,889 NPV (post-tax) approximated @10% discount rate ZAR (M) 1,267 AUD (M) 114
Metal price – Ag USD/oz 24 IRR (pre-tax) % 44%
Exchange rate ZAR : USD 17.2 :1 IRR (post-tax) % 37%
Exchange rate ZAR : AUD 11 .1: 1 Payback from first production years 3.25 years
Production Metrics Unit Value Undiscounted free cash flow (pre-tax) ZAR (M) 4,607 AUD (M) 413
Life of Mine (Proof-of-Concept Phase) Years 11.8 Peak funding ZAR (M) 643 AUD (M) 58
Treatment plant capacity ktpa 780 Project Cost Metrics Unit Value Unit Value
Proof-of-Concept Phase tonnage – RoM kt 9,011 Average cash operating unit cost (C1) ZAR/t 781 AUD/t 70
Proof-of-Concept Phase tonnage – RoM U/G kt 7,479 All-in-sustaining cost per unit RoM t ZAR/t 873 AUD/t 78
Proof-of-Concept Phase tonnage – RoM O-Pit kt 1,531 All-in-sustaining cost per unit Cu t sold USD/t Cu 4,478 AUD/t Cu 6,904
RoM Plant Feed Grade – Cu – U/G % 1.29% Price received (net of NSR) – Cu USD/t Cu 7,441 AUD/t Cu 11,473
RoM Plant Feed Grade – Cu – O-Pit % 1.28% All-in-sustaining margin % 40%
RoM Plant Feed Grade – Au g/t conc 2.2 Operating breakeven grade – Cu % 0.83%
RoM Plant Feed Grade – Ag g/t conc 34 Project Cash Flows Unit Value Unit Value
Overall Plant Recovery – Cu % 87.4% LoM net revenue ZAR (M) 12,712 AUD (M) 1,142
Concentrate tonnage – Cu kt 386 LoM operating costs (plus State Royalty) ZAR (M) 7,320 AUD (M) 657
Concentrate grade – Cu % 25.8% Project Start-up Capital Expenditure ZAR (M) 595 AUD (M) 53
NSR as % of metal price – Cu % 96.9% Sustaining Capital Expenditure ZAR (M) 188 AUD (M) 17
Metal sold (in concentrates) – Cu Tonnes 102,329 Income Tax ZAR (M) 1,368 AUD (M) 123
Total Cu Sales Tonnes 386,787 Cash Flow After Tax ZAR (M) 3,241 AUD (M) 291
Level of Accuracy of Financial Model ± 25%, LoM = Life of Mine, NSR = Net Smelter Return, NPV = Net Present Value, IRR = Internal Rate of Return
There is a low level of geological confidence associated with Inferred Mineral Resources and therefore there is no certainty that further exploration work will result in the
determination of Indicated Mineral Resources or that the Production Target or financial forecast information referred to in this Study will be realised. Source: ORN Okiep
Financial Model revision 4.0
Table: Key assumptions and project performance parameters for the Okiep Copper Project (Flat Mines Project area) (numbers may contain
apparent rounding errors).
Refer ASX/JSE release 3 May 2021.
Date: 29-08-2022 08:21:00
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