Australian copper mining company Sandfire Resources has awarded a $235m (A$368.03m) mining services contract to Perenti subsidiary African Mining Services (AMS) at the A4 open pit within the larger Motheo copper mine in Ghanzi, Botswana.
With a term of 73 months, the contract will see AMS provide all the surface mining services tied to the development, as well as production activities at the open pit.
It is located 8km from Sandfire’s existing T3 open pit, which AMS has already developed, and which is progressing towards production.
Works on the A4 pit are expected to begin this month, with pre-strip mining anticipated to begin next month.
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Sandfire plans to operate the T3 and A4 open pits as a larger, integrated mining operation and will leverage benefits of scale and operational synergies for an optimised return on capital.
The company expects to gain from primary synergies including optimisation of existing infrastructure, mining equipment, maintenance facilities, and technical and operational management.
Perenti managing director and CEO Mark Norwell said: “We are excited about the opportunity to expand our partnership with Sandfire Resources. Motheo is a long-life asset in the Kalahari Copper belt, and the expansion of our role here is in keeping with our strategy of disciplined growth within top-tier mining jurisdictions with high-quality partners.
“Sandfire is now one of our largest clients and over the term of the combined contracts, the T3 and A4 open pits are expected to generate total revenue of over A$1.1bn, delivering strong returns for Perenti and its shareholders.”
Located in the Kalahari copper belt, the Motheo open pit copper mine has an initial processing rate of 3.2 million tonnes per annum (mtpa) with a further extension for up to 5.2mtpa. The life of the mine is nearly ten years.
The mine’s operations are centred around the T3 and A4 mines, which were officially opened last month. The copper concentrate produced at Motheo will be transported to Walvis Bay, Namibia, where it will be shipped to smelters around the world.