MOD Resources Ltd (ASX/LSE:MOD) Lifting the (calcrete) lid on the Kalahari Copper Belt

MOD is a copper development company with a 28ktpa project, T3, in the rapidly developing and exciting Botswanan Kalahari copper belt. Along with T3, which we value at NPV (8%) US$222 million post tax using the recently released DFS, the company owns a further approximately 11,700km2 of licences along the 140km strike of the copper belt.



Within this they are discovering (at a 100% hit rate) fresh new deposits exhibiting high grades and understood mineralogy. The first production from T3 is expected to come on stream in early 2021.

We would expect that shares to be trading at £0.36 well before then. Key points: Botswana – the best destination for foreign investment in Africa, Botswana is the poster child of African post-colonial success.

From being one of the poorest countries at independence in 1966, the country is now considered an upper middle-income
country with a stable political environment. GDP growth is still running at a healthy 4.4% rate and it is the least corrupt of major Sub Saharan African countries.

This has been built on a sensible approach to the phenomenal diamond discoveries of the 70s, and more recently tourism, and their effect on a relatively small population of now c.2.8 million. There is a simple licensing route, royalty structure and tax code making foreign investment relatively straightforward. There is also a well-educated workforce with experience in geology and mining.

Geological advantages – sedimentary, large scale and a decent grade Sedimentary copper deposits typically carry good grades, often near surface and as such are low in capex intensity making them perfect targets for small to mid-scale mining projects.

In Botswana, the trick is finding the discrete lenses of higher grade material and their signature settings especially given the Kalahari copper belt is relatively underexplored. MOD have become proficient at interpreting aeromagnetic as well as airborne EM data and identifying the dome structures hosting the copper deposition. It is highly likely that they will be able to
add further material resource at their several other projects Metallurgical advantages – calcrete, no transition material, strong recoveries Crucially, unlike the belt further to the north east, the licence area is covered by a c.5-7 metre layer of calcrete.

This has prevented weathering of the near surface resource delivering open pittable sulphides that can go through a simple flotation process. Moreover, the mineralogy, chalcopyrite with bornite and chalcocite, is very amenable to flotation with the company able to achieve 93% recoveries in producing a c.30% copper concentrate with silver byproduct.



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