The expanded scope will incorporate an extended footprint to access additional resources that are outside of the original feasibility study target area that have been identified by ZYL’s drilling and further technical work during 2012.
It would also allow for a revised mine development to enable the most optimal approach to the development of the overall resource across a greater project area, according to ZYL.
“The completion of the BFS will therefore be necessarily extended to evaluate and incorporate the most favourable development option based on today’s enlarged resource base and the potential of an open-pit component,” the company said.
A 20.11 million tonne resource estimate for the project as part of a 2008 feasibility study has grown considerably because of extra drilling campaigns and geological modelling.
The resource now sits at 154.2Mt and modelling has extended beyond the Mbila Mining Right Area into the Msebe Prospecting Right Area.
The Mining Right, Environmental Management Program, and Social and Labour Plan approvals were granted based upon this original 2008 study.
“It is believed that the incorporation of the resources outside of the Badger Study area [including the Msebe Prospecting Right Area] into the BFS will provide greater flexibility and the opportunity to exploit larger blocks of anthracite with fewer adits, including the possibility of defining an open pit area in the Beaufort zone,” the company said.
“An open pit will allow the mining of multiple seams in the Beaufort package and hence greater extraction of the mineable resource. The establishment of an open pit would potentially support a quicker build up to sustainable production with lower operating costs.”
A further factor has been the strong level of interest in securing off-take due to the increasing demand for anthracite in South Africa and internationally.
This interest has been demonstrated by the expressions of interest that have been received by the company from third parties who have indicated a desire to secure off-take, provide debt finance, project funding and infrastructure solutions, it said.
“These potential strategic partners have articulated a favourable view on exploiting more tonnes of anthracite at a lower cost in a mining operation that incorporates a simple open pit component,” ZYL said.
“These parties may have an influence on the development options that the company will consider.”
The continued evaluation of development scenarios should not affect the overall development timeline for the Mbila Project and the final permitting process (water permit) is on schedule for completion in mid-2013.
“The board is excited about the prospect of improving the BFS metrics despite the delay to BFS completion that the expansion creates,” the company said.
“ZYL’s priority is to ensure an optimum development strategy that avoids sterilizing recently identified resources from future exploitation and to ensure the strategy takes into account all of the latest technical information.”