Copper miner Sandfire Resources has announced its decision to transition the DeGrussa mine to care-and-maintenance and is considering various options for the mine, including closure, rehabilitation, and divestment. The company made the move to process oxide copper stockpiles earlier this year but faced challenging economics due to the low-margin nature of the stockpiles. The material’s high clay content adversely affected metallurgical recovery and throughput rates, leading Sandfire to cease oxide processing operations in May.
Sandfire CEO and MD Brendan Harris stated that discussions were underway with several parties, exploring all alternatives for the DeGrussa mine. In the period from April to June, DeGrussa contributed 1,435 tonnes of copper and 1,234 ounces of gold, while Sandfire’s total production for the quarter amounted to 17,460 tonnes of copper, 25,345 tonnes of zinc, 4,080 tonnes of lead, and 1,234 ounces of gold.
For the full year ended June, DeGrussa contributed 27,502 tonnes of copper, 19,122 ounces of gold, and 0.1 million ounces of contained silver. Sandfire’s overall production figures for the same period stood at 84,056 tonnes of copper, 85,929 tonnes of zinc, 10,747 tonnes of lead, 19,122 ounces of gold, and 2.8 million ounces of silver.
Sandfire also reported a 13% increase in production at its MATSA operations in Spain during the June quarter. Furthermore, the company achieved a significant milestone with the production of its first copper concentrate at the Motheo copper mine in Botswana. This marked the start of the ramp-up process towards the mine’s initial processing capacity of 3.2 million tonnes per year, expected to be reached by the September quarter of 2024.
Harris emphasized the anticipation of a rapid ramp-up in throughput at Motheo, with the operation already achieving nameplate capacity and a maximum copper recovery of 89% recorded across multiple shifts. He also highlighted the approval of the environmental impact assessment for the A4 project by the government of Botswana. This development opens the way for extending the Motheo mining license and increasing contained copper production to over 50,000 tonnes in 2025 through the development of the higher-grade A4 pit and the expansion of processing facilities to 5.2 million tonnes per year.
Sandfire is continuing its exploration activities at MATSA, with recent drilling extending the identified strike length of the San Pedro mineralized zone to approximately 550 meters. The company is currently conducting additional tests to explore a further 650-meter extension. In addition, Sandfire has identified a new system called the Olivo zone, west of Magdalena, where drilling has intersected massive sulphides over an initial strike length of 300 meters.
Harris stated that the 2024 financial year is expected to be transformative for the company, with incremental growth at MATSA and the ramp-up of Motheo offsetting the loss of production from DeGrussa. As a result, copper equivalent production is set to rise by 10% to 13,500 tonnes. He expressed confidence in the company’s operations in Spain, Botswana, and Australia, projecting over 50% growth from continuing operations by the end of the 2025 financial year.
Sandfire’s decision to transition DeGrussa mine to care-and-maintenance reflects the company’s response to the challenging economics of processing low-margin oxide stockpiles. While closure, rehabilitation, and divestment options are being considered, Sandfire remains focused on executing its growth plans at MATSA and Motheo. With a commitment to sustainability and delivering value to its stakeholders, Sandfire continues to make strategic decisions to navigate the evolving copper mining landscape.
