AMN - OMAN/MOZAMBIQUE: Savannah has plans to value-add

Savannah Resources has made significant progress on implementing a strategy of adding value to assets with near to medium-term production potential and superior operating and capital cost characteristics.

The company has signed an agreement with Rio Tintofor the combination of Rio’s Mutamba project and Savannah’s adjacent Jangamo project in a joint venture located in a world-class heavy mineral sands (HMS) province in Mozambique. It is targeting defining higher-grade, HMS mineralisation in 2016 for a scoping study for a dry mining operation to produce a HMS concentrate containing ilmenite, rutile and zircon

Savannah has also set an exploration target of between 150,000 and 700,000 tonnes of contained copper has been estimated for Block 4 and 5 in Oman. It is targeting commercial copper production in Oman in late 2017 using a central processing hub to minimise capital expenditure and maximise operating margins.

Savannah CEO David Archer says: “We made great progress in 2015, particularly in giving more definition to the copper projects in Oman, with high-grade copper and gold results returned from drilling and the definition of a significant aggregate exploration target for the two blocks.

“This was augmented with a major strategic initiative, subject to Mozambican Government approvals, of the combination of our Jangamo HMS project with Rio Tinto’s Mutamba HMS project. With defined development strategies in place targeting commercial copper production in late 2017, and a planned fast paced, staged evaluation of Mutamba/Jangamo I believe 2016 will be a transformational year for the company.”

In Oman, plans centre on assessing the feasibility of establishing a central copper processing facility, which will be used to treat copper ores produced from the copper/gold deposits on Blocks 4 and 5. With near-term production being the primary goal, during the past year Savannah has made good progress in furthering the resource potential of these projects, which have an existing Indicated and Inferred Mineral Resource of 1.7 million tonnes at 2.2% copper, and importantly have also identified additional gold mineralisation that offers significant upside. The primary focus will be the definition of Inferred and Indicated Mineral Resources for the Aarja, Bayda and Lasail deposits on Block 4. Looking ahead, the focus is on moving ahead with a feasibility study of the development of the copper deposits and furthering increasing understanding of the gold potential of the area with additional drilling, with the ultimate aim of commencing commercial copper concentrate production in 2017. The projects will have the benefit of utilising the excellent infrastructure already established, which includes power, roads, and the nearby deep water export port of Sohar.

Savannah has rights to three blocks covering 1270sqkm in the copper-rich, Semail Ophiolite Belt in the Sultanate of Oman, a region proven to host clusters of moderate to high-grade copper deposits with gold credits and metallurgically simple ores. The three blocks are located approximately 180 km northwest of Muscat, the capital city of Oman and within close proximity to the export Port of Sohar. The strategy is centred on building a copper and gold resource inventory to support high margin, low cost operations and establish Savannah as a high-grade copper miner, with production targeted to start in late 2017.

www.savannahresources.com; www.riotinto.com

News courtesy of International Mining