Sandfire’s Tshukudu Operations include the T3 (Motheo) Copper-Silver Project. The T3 Project is a significant sediment-hosted copper and silver deposit, located in the underexplored Kalahari Copper Belt in Botswana.
The Project held through in-country subsidiary Tshukudu Metals, was acquired through Sandfire’s acquisition of MOD Resources Ltd in October 2019.
Tshukudu, meaning rhino in the Setswana language, is responsible for the day-to day activities of our operations in Botswana. Tshukudu works seamlessly with specialists from Australia and Sandfire’s executive management team, liaising on a daily basis.
Tshukudu has an office in the nearby town of Ghanzi, which is the focal point for managing human resources and community relations in the Ghanzi District.
Botswana is a safe, democratic, politically stable and mining-friendly jurisdiction with a supportive government (rated number 1 in Africa and number 45 globally by the Fraser Institute Annual Survey of Mining Companies).
Botswana is committed to further diversifying its resource sector, which currently contributes ~80% of the country’s exports and ~30% of its GDP. The nation has a skilled workforce, good infrastructure and sound mining legislation and environmental controls. There is strong local support for T3, with the project able to leverage off extensive local infrastructure and support.
T3 is the first of what is anticipated to be an extensive pipeline of resource development projects in the Kalahari Copper Belt, spanning Botswana and Namibia.
About the T3 (Motheo) Copper-Silver Project
Sandfire completed a positive Definitive Feasibility Study (DFS) in December 2020 on an initial Base Case 3.2Mtpa processing capacity and open pit development of the T3 Deposit.
Based on the results of the DFS, Sandfire’s Board has approved the mine development, with construction set to commence in FY2021 and first production scheduled for FY2023.
The DFS outlined a robust initial 12.5-year operation, underpinned by an updated Ore Reserve of 39.9Mt at 0.9% Cu and 12.2g/t Ag for 360,000t of contained copper and 15.6Moz of contained silver, producing on average ~30kt of contained copper and 1.2Moz of contained silver per annum over the first 10 years of operations, with relatively low capital intensity and robust operating margins.
Based on a forecast copper price of US$3.16/lb (reflecting current long-term consensus pricing) the Base Case 3.2Mtpa project is forecast to generate US$664 million ($A948 million) in pre-tax free cash-flow and US$987 million (A$1,410 million) in EBITDA (Earnings Before Interest, Tax, Depreciation and Amortisation), at a forecast all-in sustaining cost of US$1.76/lb over its first 10 years of operations.
The capital expenditure estimate of US$259 million (A$371 million) includes mining pre-strip, process plant construction, site infrastructure development, tailings storage, owner’s costs and contingency.
Reflecting its confidence in the future long-term growth of our Tshukudu operations, Sandfire’s Board has also approved an additional upfront investment of US$20 million (A$28 million) to be made as part of the 3.2Mtpa Base Case development.
This will facilitate the installation of additional processing capacity and infrastructure, providing a clear pathway to rapidly expand the processing facility to a planned 5.2Mtpa production rate as part of our planned Motheo Production Hub.
The immediate and most advanced expansion opportunity for the expanded 5.2Mtpa Motheo Production Hub is the A4 deposit, located 8km west from T3. The A4 deposit hosts an Inferred Mineral Resource of 6.5Mt at 1.5% Cu for 100,000t of contained copper, with both in-fill and step-out drilling underway to upgrade the Inferred Mineral Resource to Indicated status and underpin the completion of Pre-Feasibility and Engineering Studies.
Read the ASX announcement on the Definitive Feasibility Study for the T3 (Motheo) Copper-Silver Project.