Katanga looks to become Africa’s copper king

Katanga Mining (KAT-T) is gearing up to take a big copper project and make it that much bigger. 

The copper miner with operations in the Democratic Republic of the Congo has set its sights on a world-class copper belt and updated the market on its expansion plans for fourth-phase development at the mine complex.

Katanga says it wants to turn out another 100,000 tonnes of copper per year using a solvent extraction (SX) plant. This amount is over and above the 200,000-tonne-per-year SX plant outlined in a technical report from last year. 

The plant will be built in front of the existing Luilu electrowinning plant, and just a day earlier, on March 29, Katanga announced it had closed a deal to secure the additional power supply the larger processing facility will require. 

The plant will also reach higher copper and cobalt production levels quicker than the company anticipated. But quicker and higher production comes at a cost, and Katanga says capital expenditure will be $98 million more than originally conceived. 

Most of the extra cost comes from the SX plant and an in-pit crusher at the KOV open pit.

And while the increase in output could bring the site’s grade A copper production to 270,000 tonnes per year, Katanga doesn’t plan to stop there. 

If the initial boost to production brings a corresponding increase in cash flow, the organically generated capital will go right back into bolstering the site even further, with an ultimate production goal of 310,000 tonnes per year.  

Five deposits will feed these grand visions of production: Kamoto, T17, Mashamba East, KOV, Kananga and Tilwezembe. 

On March 23 the company issued a resource update on the deposits. 

Proven and probable reserves from four of the five deposits totalled 96 million tonnes grading 4.21% copper and 0.47% cobalt, while measured and indicated resources came in at 288.6 million tonnes grading 4% copper and 0.46% cobalt. Inferred resources stand at 169.1 million tonnes grading 2.42% copper and 0.31% cobalt. Measured, indicated and inferred tonnages are inclusive of all five deposits. 

And while the resource update showed a 9.9-million-tonne decline in total resources, the key take-away from the update was that reserves only decreased by 1 million tonnes, despite 4.5 million tonnes being mined in 2011.  

Katanga says it made up most of the mined ore through better technical designs at the KOV open pit and at the T17 underground. A new extension to the T17 open pit also made a contribution.

On March 30 — the day the update was released — Katanga shares were up 2%, or 2¢, to $1.05 on 691,000 shares traded. The company’s share price has ranged between 88¢ and $2.18 over the last 52-week period. It has 1.91 billion shares outstanding.