Sandfire Resources this week celebrated a key milestone in its rapid emergence as one of Australia’s leading mid-tier mining companies with the official opening of the DeGrussa Copper Mine by the Premier of Western Australia and Minister for State Development and Science, Colin Barnett.
The official opening ceremony was held on Monday at DeGrussa, about 900km northeast of Perth. It comes just over four years after Sandfire first made headlines with the discovery of the exceptional high-grade DeGrussa VMS copper-gold deposit during a drilling program targeting oxide gold managed by Sandfire’s technical director John Evans.
In recognition of the stunning find, John Evans shared the prestigious AMEC 2010 Prospector of the Year Award with the young contract geologist on the drill rig, Margy Hawke, and Sandfire’s founding director, the late Graeme Hutton.
Since then, Sandfire has set new benchmarks for the rapid and efficient development of Western Australian mineral resources, completing an aggressive resource drill-out, feasibility studies, approvals, financing, construction and development – from discovery drill-hole to first product sales in just three years.
Mining commenced initially via a 2-year open pit operation in parallel with the development of a longer-term underground mine which is now ramping up to a full annual production rate of 1.5 million tonnes. Ore is fed to an on-site concentrator which produces high-quality copper concentrate grading 25% copper. The copper concentrate is transported for export through Port Hedland and Geraldton.
DeGrussa has already produced more than 70,000 tonnes of copper metal and 50,000 ounces of gold worth more than Aus$500 million since operations started, including 64,017 tonnes of copper and 42,697 ounces of gold for the 2013 financial year.
The ramp-up to full nameplate production is nearing completion. Sandfire has provided production guidance for the 2014 financial year of 65-75,000 tonnes of contained copper-in-concentrate and 35-45,000 ounces of gold. This will cement its position as Western Australia’s largest copper mine. C1 cash operating costs for FY 2014 are forecast in the range of US$1.05-1.15 per payable pound, positioning the mine firmly in the lowest cost quartile.
Sandfire is spending about $20 million per year on exploration in Western Australia. It also has an active business development program both in Australia and offshore with $10 million of committed exploration and business development expenditure. The operation provides long-term employment for around 400 people.
Sandfire’s chairman Derek La Ferla says the official opening marks a tremendous milestone for the company and its shareholders, as well as the hundreds of people involved in the discovery, construction and development of the DeGrussa operation.
“There are very few mining projects anywhere in the world today which can lay claim to having moved from discovery drill-hole to first sale in the space of just three years. When the average length of time required to develop new resource projects is now 7-8 years, this is a truly remarkable achievement which has set new benchmarks for the mining industry in Western Australia.”