Kasese Cobalt inks loan plan for plant

As the political situation in central Africa continues to stabilize, more Canadian-based mining companies are advancing projects, which is having the effect of rebuilding the region’s mineral industry.

Kasese Cobalt, in which Banff Resources (bff-v) owns a 55% interest, has signed a loan agreement with several commercial and international development banks. The loan assures Kasese Cobalt of US$66 million for construction of a cobalt plant at Kasese in western Uganda. The plant will process stockpiled concentrate from the abandoned Kilembe copper-cobalt mine.

The remainder of the plant’s US$110-million capital cost will be paid by Banff, Kilembe Mines, which owns 25% of Kasese Cobalt, and a number of smaller shareholders, including International Finance Corporation.

The project is on a 15-month schedule, with the first cobalt slated for shipping in late 1998. A total of 990,000 tonnes of concentrate with a grade of 1.38% cobalt will provide the plant’s initial feed source. At the plant’s planned capacity of 1,200 tonnes of cobalt cathode per year, the stockpile could last 11 years.

Less is expected of the Kilembe mine, which was operated throughout the 1950s and 1960s by the Kilembe Copper subsidiary of Falconbridge Nickel. Drilling at Kilembe did not indicate any large blocks of minable material and, though feasibility studies continue, Banff does not plan any further work. But the property does have a substantial tailings resource, which is expected to provide another four years of feed for the Kasese plant once the existing stockpile of concentrate is depleted.

Kasese Cobalt estimates the resource at 5.2 million tonnes of tailings grading 0.12% cobalt and 0.18% copper, and describes it as “probably treatable.” Metallurgical testing is under way, and Kasese Cobalt has engaged Time Mining as consultants for a feasibility study. The tailings would be concentrated before shipping to the Kasese plant.

The plant itself will employ a bioleaching process followed by solvent-extraction and electrowinning of cobalt cathode. A 10,500-kW hydroelectric plant is under construction.