AfriTin Mining has released the results of its Definitive Feasibility Study (DFS) for the Uis Tin Mine. The DFS confirms the feasibility of expanding the current Phase 1 processing plant from 720 tonnes/year of tin concentrate to 1,200 tonnes.
AfriTin acquired the mining license incorporating the historic Uis mine in 2017. The mine was previously operated by ISCOR of South Africa from 1958 to 1990. At that time, ISCOR published an Ore Reserve estimate of 75.3 million tonnes of ore, containing 102,920 tonnes of tin.
Initially, AfriTin published an Ore Resource for Uis, containing 71.54 million tonnes of ore at 0.134% tin and 0.0085% tantalum. In this most recent announcement, the company has collected enough data to publish a Mineral Reserve. The Reserve contains 12.59 million tonnes of Proven Reserves containing some 17,548 tonnes of tin, and a Probable Reserve of 3,988 tonnes of metal in some 3.03 million tonnes of ore.
Since taking over the mine site, AfriTin has mined some 250 tonnes of tin-in-concentrate. The mine reached nameplate capacity towards the end of 2020 and has been operating above this mark for several months. However, the company is looking to improve this further and plans to increase production by some 67%.
For an investment of US$ 5.7 million, AfriTin plans to reconfigure its processing plant. This work includes installing additional gravity separation spirals to re-process tin middlings and replace the existing shaking tables with more modern Holman tables. Changes to the dense media separation systems (DMS) will improve operability and stability. In total, the works will increase ore throughput by 50% and increase tin recovery from 60% to 64%.
The upgrade project has robust economics, with an NPV of US$ 12.1 million and an IRR of 54%. AfriTin aims to lower the operating costs of the mine to a direct cash costs of US$ 14,802/tonne tin quoted by AfriTin. Smelter charges of US$ 1,577/tonne tin are applied on top of this. AfriTin CEO Anthony Viljoen commented: “We are especially pleased with the robust economics of the study which provide us with an opportunity to substantially increase the revenue and profit margin of the current operation”.
AfriTin plans to complete the expansion project within eight months of starting. This includes a 2-week plant shutdown while it is reconfigured. Apart from this, production at Uis will continue as normal.
Our view: AfriTin‘s plans to expand the Uis tin mine come at a time when tin prices are reaching decade highs. Current LME prices are in excess of US$ 28,000/tonne, which according to AfriTin‘s DFS would increase its NPV by some 40%. This would bring the value of the project to some US$48.4 million, with a payback period of less than one year. Furthermore the DFS only includes tin products; the company intends to production tantalum and lithium oxide in due course.
Overall, the expansion to the Phase 1 operations at Uis will help in “de-risking the expansion of the project into the much larger Phase 2 operation that is intended to be 6 to 10 times bigger than the phase 1 operation”, according to Anthony Viljoen.