Leigh Creek Copper Mine Update
Conditional PEPR Approval
Strategic Minerals plc (AIM: SML; USOTC: SMCDY), a profitable, producing mineral company is pleased to confirm that its wholly owned subsidiary, Leigh Creek Copper Mine (“LCCM”), has been granted a conditional approval from the Department of Energy and Mining of South Australia (“DEM”) for its Programme for Environmental Protection and Rehabilitation (“PEPR”) on the Paltridge North deposit (“Paltridge North”) MPEPR2020/032.
DEM approved the PEPR application subject to reviewing:
· LCCM’s final plans for identifying and managing Potentially Acid Forming (“PAF”) material.
· The cover design for Paltridge North Waste Rock Dump (“WRD”) and heap leach pads.
· Visual amenity associated with the Paltridge North WRD.
· Plans for post completion of surface water management structures.
· Continued liaison with Traditional Owners of the land.
· The groundwater monitoring programme which is to be submitted to and approved by the Minister of Water Resources.
As part of the approval, the DEM requires:
· An environmental security deposit of AUD $3.7M.
· Native Vegetation Fund contribution via a Significant Environmental Benefit payment of $81,398.52 to offset for native vegetation clearing.
To a large extent, the conditions associated with the approval were expected and reflected on LCCM’s PEPR application. Whilst the bond requirement is larger than catered for in the Company’s financial modelling of the project, the Company is comfortable with this level given the current overall amount of funding being sought.
The Company considers that the cost of funding the additional environmental security deposit will have a negligible effect on the profitability of its planned accessing and processing of material at both Paltridge North and Lynda/Lorna Doone (the “Project”). This impact will be more than offset as current market parameters indicate an increase of around 20% in the LCCM’s Project profitability, reflecting the current copper prices and the AUD/USD exchange rate (US $4-28/lb and 0.7500 respectively) compared to the previous levels employed (US $4-00/lb and 0.7800) and the Project’s 50% operating margin.
Commenting, John Peters, Managing Director of Strategic Minerals, said:
“The conditional approval of the PEPR was as expected and is an important milestone in restarting full-time production at the Mountain of Light plant at Leigh Creek.
“Work will begin on fulfilling the conditions, some of which are already underway, and the Company will report on its plans in due course.
“In the interim, the Company will continue to seek debt style funding for the Project and has had a number of encouraging meetings with potential funders. Increased forecasted Project profitability and planned exploration has significantly improved the Project’s attractiveness and is assisting attempts to secure funding, especially as planned facility repayment is forecast to occur within two years of drawdown (inclusive of funds applied for exploration purposes). ”
For further information, please contact:
Strategic Minerals plc
+61 (0) 414 727 965
Notes to Editors
Strategic Minerals plc is an AIM-quoted, profitable operating minerals company actively developing projects tailored to materials expected to benefit from strong demand in the future. It has an operation in the United States of America along with development projects in the UK and Australia. The Company is focused on utilising its operating cash flows, along with capital raisings, to develop high quality projects aimed at supplying the metals and minerals likely to be highly demanded in the future.
In September 2011, Strategic Minerals acquired the distribution rights to the Cobre magnetite tailings dam project in New Mexico, USA, a cash-generating asset, which it brought into production in 2012 and which continues to provide a revenue stream for the Company. This operating revenue stream is utilised to cover company overheads and invest in development projects aimed at supplying the metals and minerals likely to be highly demanded in the future.
In May 2016, the Company entered into an agreement with New Age Exploration Limited and, in February 2017, acquired 50% of the Redmoor Tin/Tungsten project in Cornwall, UK. The bulk of the funds from the Company’s investment were utilised to complete a drilling programme that year. The drilling programme resulted in a significant upgrade of the resource. This was followed in 2018 with a 12-hole 2018 drilling programme has now been completed and the resource update that resulted was announced in February 2019. In March 2019, the Company entered into arrangements to acquire the balance of the Redmoor Tin/Tungsten project which was settled on 24 July 2019 by way of a vendor loan which was fully repaid on 26 June 2020.
In March 2018, the Company completed the acquisition of the Leigh Creek Copper Mine situated in the copper rich belt of South Austra lia and brought the project temporarily into production in April 2019. The project has been granted a conditional approval by the South Australian Government for a Program for Environmental Protection and Rehabilitation (PEPR) in relation to mining of its Paltridge North deposit and processing at the Mountain of Light installation.
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