The company, which produces some 4% of the world’s tin-in-concentrate, produced 2,412 tonnes of contained tin during Q2. However, this was some 11% lower than guidance, and down 8% from the previous quarter.
According to the company, a lower-than-expected feed grade was the main factor behind the fall. Mining grades can vary due to natural variations in the orebody; during the second quarter, the feed grade fell to 3.2% from 3.8%. To keep grades more consistent, Alphamin is planning to increase waste development. The material can then be blended with higher grade ore to prevent volatility in the grade.
With lower contained tin production, EBITDA was likely to decrease. Alphamin has announced that guidance for the second quarter is US$ 34 million, some 7% lower than Q1. However, Q1 was also boosted by catch-up sales of tin due to disruptions toward the end of 2020.
However, despite a weaker quarter, the outlook for Bisie remains positive.
The Fine Tin Recovery Plant, which has been in development at Bisie since April 2020, is now fully commissioned. Production has been steady since the end of June, and increased contained tin production by 5% during the first week of its operations. The product is reportedly exceptionally high grade; Alphamin are considering lowering the product grade to further increase tin recoveries.
Drilling at Mpama North began on 2 July. This drilling campaign aims to test the lateral and vertical extent of the existing orebody. Some 22 holes will be drilled over the next four months, totalling some 15,000 metres.
Drilling at Mpama South has now been completed, and the company is waiting on the remaining drill core assays. 29 results have already been announced, and the others will be announced in two batches; the first in July, and the other in early August. Another 24 holes are currently being drilled – to date, 5 have been completed. Early visual results indicate wide intercepts of mineralisation. This aligns with the company’s interpretation of the mineralisation, which indicates a high-grade shoot.
Our view: The fact that Alphamin is planning to increase waste development in order to blend it with ore from Mpama North is an indication that the company is expecting higher grade material over the next quarter. Combined with a full quarter of production from the Fine Tin Recovery Plant – perhaps tuned to increase recoveries – production is likely to increase.