Hillgrove Resources has announced the commencement of early works on the underground Kanmantoo copper mine.
The SA mine was closed in 1976 due to the increased costs of copper mining, but Hillgrove began rehabilitating the site in 2007 following a definitive feasibility study, with production beginning in late 2011.
Since its initial close, Hillgrove has proved an additional indicated and inferred mineral resource of 34.5 million tonnes grading 0.6 per cent copper and 0.1 grams of gold a tonne.
The open-cut operation at Kanmantoo mine was again wound up in 2019, but now the company is poised to tunnel deeper than ever before to access previously unreachable ore bodies.
In an announcement, Hillgrove said that economic assessment of the project has demonstrated strong free cash flow potential of $205 million from recommencement of operations in 2023.
Specialised contractors have been engaged to commence early works activities in preparation for the commencement of underground development. This includes geotechnical remediation of the pit walls, hail road preparation and pit dewatering.
Contracts for equipment, personnel and services for the development are nearing finalisation.
The mine is already very well advanced, with a fully permitted and operational processing plant, tailings storage facility, and all necessary infrastructure at portal, including power, water, and ventilation.
Thanks to this, underground development to access ore is scheduled to commence as soon as next quarter.
“Following the successful capital raise earlier this month, we have wasted no time in commencing work towards both the underground development at Kanmantoo to get back into production as well as mine life expansion drilling,” Hillgrove chief executive officer, Lachlan Wallance, said.
“Over the coming weeks we expect to finalise supply and service contracts and commence mobilisation. We are working towards a smooth mine ramp up, ensuring that as equipment arrives, we can immediately commence mine development.
“With the portals already established, our miners can walk in on day one and take development cuts. We remain on track to commence copper production in early 2024, making Hillgrove Australia’s next copper producer.”