Equinox Minerals Lumwana Copper Mine, Zambia

Australian/Canadian mining company Equinox Minerals Ltd is close to producing the first copper from its Lumwana open-cut copper mine project in Zambia. Located in the North West province of Zambia, 220km west of the Copperbelt and 65km west of the town of Solwezi, it is reported to be Africa's largest copper mine and is scheduled for commissioning in mid-2008.

Equinox's mining licence covers 1,355km² and includes two major copper deposits, Malundwe and Chimiwungo, as well as 25 exploration prospects. The licence is valid for 25 years (from January 2004) and is renewable for a further 25 years.

Equinox completed a uranium feasibility study in 2008 which showed output of 2Mlb per year of uranium oxide and 15,000t of copper could be mined simultaneously from the discrete uranium-enriched zones in the Lumwana copper pits. Uranium plant commissioning is now targeted for 2010 and copper production is due to start in July 2008.

In May 2008 Equinox Minerals was also able to secure a long-term (99 years) land title to 35,000ha for its township and mine operation areas.

Although Lumwana was discovered in 1961, no serious work was carried out there until Equinox became involved in 1999. At the time, the property was controlled by Phelps Dodge Corp. Equinox formed a joint venture with Phelps in which Equinox could earn 51% of Lumwana by investing $10m and completing a feasibility study. Later, Equinox bought Phelps out for $5m, giving Equinox 100% ownership of Lumwana.

Construction of the mine started in earnest in late 2006, and has been carried out by about 4,700 local workers. Building it has cost about $760m. So in 2006, Equinox completed three rounds of equity financing totalling $250m through a short-form prospectus equity issue managed by an international syndicate of underwriters, a private placement equity issue to ZCCM Investments Holdings plc managed by the company and a second short-form prospectus equity issue managed by an international syndicate of underwriters.

The company also signed a $583.8m senior and subordinated project finance debt facility with a group of financial institutions for the completion of development and construction of Lumwana.

GEOLOGY

The Lumwana deposits of Malundwe and Chimiwungo are hosted within the Mwombezhi Dome, a north-east trending basement dome in the western arm of the Neoproterozoic Lufilian Arc thrust-fold belt. The Lufilian Arc is a major tectonic province characterised by broadly north-directed thrust structures and antiformal Basement inliers or domes surrounded by Katangan metasediments, which host the Central African Copperbelt.

MINERALS

The copper mineralisation at Lumwana is hosted almost entirely within high-grade metamorphosed, intensely mylonitised, recrystallised muscovite-phlogopite-quartz-kyanite schists with disseminated sulphides (typically <5%) dominated by chalcopyrite and bornite.

Of the two major deposits, Malundwe is smaller but with higher copper grade and contains discrete zones of uranium and gold mineralisation with occasional sporadic high cobalt (>0.1%). Chimiwungo is much larger and lower in copper grade, but has higher overall cobalt and contains a number of significant high-grade (>0.1%) cobalt zones plus some sporadic uranium mineralisation.

RESERVES

Measured and Indicated Reserves total 321 million tonnes averaging 0.73% copper (5.97 billion pounds of contained copper) with additional Inferred Resources totalling 417 million tonnes averaging 0.6% copper (more than 7.8 billion pounds of contained copper).

PRODUCTION

It is envisaged that the Malundwe and Chimiwungo deposits, which are 7km apart, will be mined sequentially by open-pit methods. The ore bodies are 95% sulphide (with only 5% oxide) and very consistent, so large-scale bulk-mining methods will be used.

Equinox will mine an average of 20 million tonnes per year to produce an average of 122,000t of copper per year over the 37-year mine life. Because of higher head grades during the first six years of operation; the mine will produce an average of 169,000t of copper per year.

Production will involve the use of four hydraulic face shovels for waste and ore and two hydraulic excavators (26m³ ) plus a smaller unit (15m³) for selective ore mining and 26 large AC-drive haul units (242t). These units will be supported by a fleet of drills, front-end loaders, bulldozers, graders and other ancillary equipment. using equipment that includes 240t capacity diesel-AC drive haulage trucks and 26m³ capacity electric face shovels.

PROCESSING

Metallurgical test work indicates greater than 95% recovery of copper by conventional flotation processing. Test work shows that Malundwe will produce a concentrate grading 41–45% copper and Chimiwungo is expected to produce a concentrate grading 28–32% copper.

Sulphide ore will be processed on-site by conventional flotation to produce copper concentrates for shipment to off-site smelters. Concentrates will be smelted and refined into metal at smelters either in Zambia, southern Africa and/or offshore. Negotiations are underway with a number of regional smelters, LOIs having been signed with Palabora Mining Company of South Africa, Ongopolo Mining & Processing Ltd of Namibia and Mopani Copper Mines plc of Zambia.

Trucks from the mine will tip directly into a 400t capacity ROM dump hopper. A primary gyratory crusher will be used to crush the ROM ore from a nominal top size of 1,500mm to less than 200mm. Oversize material will be deposited on the ROM pad to be further broken by a mobile rock breaker.

Ore will be reclaimed via apron feeders onto a conveyor belt providing direct feed, at a rate of about 2,500t/h, into the 38ft × 18ft SAG mill. The SAG mill trommel undersize will discharge into a hopper and will be pumped to conventional hydrocyclones, operating in closed circuit with a 26ft × 40ft ball mill. The hydrocyclone overflow (P80 of 280µm) reports to flotation, while the underflow returns to the ball mill.

The flotation plant will consist of two parallel trains of rougher/scavenger cells. The rougher/scavenger concentrate will report to the regrind circuit to further liberate the copper minerals. After regrinding, the concentrate will be cleaned in a conventional cleaner/recleaner circuit to reach final concentrate grade.

The concentrate will be dewatered in a circuit consisting of high-rate thickening followed by pressure filtration to produce a filter cake suitable for transportation. Flotation tailings will be thickened and pumped to the tailings dam. Most of the plant water will be recovered and recycled from the thickener overflows and tailings dam return water. Fresh make-up water will be supplied from a river-water dam as required.

Once the mine is in production it will employ 1,000 workers who will live with their families in an employee village.

A key reason Lumwana has not been mined earlier is the limited infrastructure in the region. Although the Northwest Highway, which links the Lumwana region, Solwezi and the Copperbelt, passes within 3km of the project, the Zambian government has completed a highway upgrade as far as Solwezi and has committed to extend the upgrade to Lumwana. It has also completed a 330kV power line to Solwezi which will be extended to Lumwana.

Australian company GRD Minproc Ltd has been appointed the Front End Engineering and Development contractor while the Ausenco International of Australia and Bateman Minerals and Metals of South Africa Joint Venture is the EPC contractor. Golder Associates will be responsible for the resource and some mining aspects, and Knight Piésold Pty Ltd for the tailings and water management sections.