International Base Metals Limited (IBML), the Australian based holding company of Craton Mining and Exploration (CME), which owns the Omitiomire copper deposit near Windhoek, is confident that mining operations will start ‘soon’,
after previous owners sold the farm on which the deposits are situated.
A long-running family feud by the previous owners has delayed the project, situated 140km northeast of Windhoek.
The initial plan was to mine 40,000 tons of copper per month, but this has been amended to 10,000 tons per month.
International Base Metals chairman, Hugh Thomas said in the company’s 2017 Annual Report released this week, that Omitiomire farm became embroiled in an inheritance dispute that ultimately required the appointment of a Trustee while the heirs endeavoured to settle their differences.
“The farm is in the final stages of being sold and we believe there are no reasons that the transaction should not be completed. The new owner of the farm is known to both the Craton and IBML boards and we have already started negotiating access to the farm and the negotiations have been held in a positive light,” Thomas said.
He said the company is encouraged that access rights will be re-established and confirmation of the mining plan can be completed.
The company is also in the final stages of a transaction to sell an equity position in Craton to a Namibian group that will satisfy the requirements of the Namibian Government for at least five percent equity to be held by a Namibian entity.
Once this is done, Thomas said it will mark a significant milestone in both the granting of the mining licence and the development of the mine, with mining expected to start next year and full production in 2019.
The company’s plans are to construct and operate the Omitiomire oxide copper project and complete a Definitive Feasibility Study on the Omitiomire sulphide copper resource to continue exploration for additional near-mine copper resources.
Thomas disclosed that last year, Craton received a letter from the ministry of mines and energy stating that it was prepared to grant a mining licence covering the Omitiomire project once all outstanding issues have been resolved.
“After seeking clarification on the terms and conditions of the licence, Craton was informed that it would be issued once Craton has made a minimum five percent equity shareholding available to approved Namibian citizens or companies.
“Craton’s directors and consultants are in discussions with Namibian groups which satisfy the ministry’s requirements and are confident of finding an appropriate shareholder during the 2018 financial year,” Thomas said.
In late October 2016, the Namibian Minerals Ancillary Rights Commission granted Craton access rights to the farm Omitiomire for the purpose of mineral exploration.
Thomas said legal issues between the Trustee of the Estate and potential benefactors, of which some were hostile to Craton’s intention to develop the Omitiomire Project, had prevented access to the farm.
The legal issues are expected to be resolved this month.
“A more recent development is that the farm Omitiomire is being sold, IBML sees this as a positive step in the resolution of the issues involving the Trustee of the Estate which currently has the oversight of the Omitiomire farm. When the sale process has been completed, Craton will negotiate an access agreement with the new owner,” Thomas said.