Bougainville Copper Limited · ASX:BOC
Bougainville Copper — Technical Presentation (November 2016)
33 slides from Bougainville Copper's technical presentation, November 2016
Slide 1: Order of Magnitude Study – 2016 Update
Bougainville Copper Limited Order of Magnitude Study – 2016 Update November 2016
Slide 2: Outline
Order of Magnitude Study – 2016 Update Outline • Purpose and scope • Key Findings • Capital and operating costs • Resource and potential mineable inventory • Processing • Tailings • Power • Environment • Development Schedule • Next steps • Summary
Slide 3: Cautions
Order of Magnitude Study – 2016 Update Cautions • The OMS only indicates whether an economically viable operation is possible. It doesn’t provide recommendations on how BCL should develop the mine. • To proceed to development, BCL requires completion of a Pre Feasibility Study and a bankable Feasibi
Slide 4: Purpose and Key Assumptions
Order of Magnitude Study – 2016 Update Purpose • The BCL Board commissioned the OMS to assess the potential technical and financial viability of re-developing the Panguna mine, using long term price & cost estimates. • A wide range of options were considered. Key Assumptions • OMS study has an under
Slide 5: OMS Scope
Order of Magnitude Study – 2016 Update OMS Scope • Develop a resource model; • Determine mining and ore processing rates for base and expanded cases; • Conceptual life of mine production schedules; • Assess alternative land tailings storage options.; • Assess power generation options; • Social and c
Slide 6: Focusing question
Order of Magnitude Study – 2016 Update Focusing question: What are the financially, environmentally and technically viable Panguna development options that would be potentially be acceptable to stakeholders?
Slide 7: Major options assessed
Order of Magnitude Study – 2016 Update Major options assessed: Mining rates • 100 and 125Mt/y Processing rates (based on 30Mt/y modules) • 30, 60 and 90Mt/y Tailings Disposal • On land conventional paddock, • Valley fill, • Deep sea tailings placement (east coast) Accommodation • Combination of a Si
Slide 8: Base Case Description
Order of Magnitude Study – 2016 Update Base Case Description Redevelopment considered: Parameter Base • Conventional truck and shovel open pit mine Pit size (Bt) 2.2 • Ore processing at 60Mt/y Waste Rock (Mt) 760 • Produce Cu-Au concentrate Waste to ore ratio 0.5 • Export from Anewa Bay port (Loloho
Slide 9: Major Assumptions
Order of Magnitude Study – 2016 Update Major Assumptions Item 2013 2016 • Mine up to 100Mt/y Copper ($/lb) $2.60 $2.96 • Low waste to ore ratio 0.5 Gold ($/oz) $860 $1,234 • Processes 1.4Bt at 60Mt/y Exchange rate $0.92 $0.72 (A$/US$) • Operate for 24 years Company tax 30% 30% • Mining tax condition
Slide 10: Indicative payments to Governments
Order of Magnitude Study – 2016 Update Indicative payments to Governments – $ M/y Life Of Mine 2013 2016 2016 annual average 60Mt 90Mt Personal income 43 33 36 tax Corporate tax 116 254 308 ABG Royalties 28 42 51 Dividend 20 15 18 withholding tax GST on capital 1 1 1 Total 208 344 414 Note: Payments
Slide 11: Indicative payments to Landholders
Order of Magnitude Study – 2016 Update Indicative payments to Landholders – $ M/y Life of mine 2013 2016 2016 average 60Mt 90Mt Free Carry - 41 50 (based on possible dividends) Landowner - 28 34 Royalties Landowner 59 4 4 Payments Total 59 73 88 Note: Landholders would receive payments during the pr
Slide 12: Capital Costs
Order of Magnitude Study – 2016 Update Area 2013 ($M) 2016 ($M) Capital Costs Changes since OMS: Mining 547 560 • Escalation of 2.3% PCS plant 75 77 • Environmental clean up Processing 856 875 allowance Infrastructure & port 489 500 • Waste dump acid water Tailings & environ. 351 853 treatment • Riv
Slide 13: Mineral Resource
Order of Magnitude Study – 2016 Update Mineral Resource • BCL published a revised Mineral Resource statement in February 2013 based on the results of the original 2013 OMS. • This reflected the impact of the current outlook for metal prices, higher throughput more efficient processing plant and larg
Slide 14: Resource Estimate
Order of Magnitude Study – 2016 Update Resource Estimate • BCL’s Historic resource estimate understated the amount of ore present; • OMS prepared a factored resource estimate to compensate for this underestimation; • Independent review confirmed that the factored estimate was a better representation
Slide 15: Resource
Order of Magnitude Study – 2016 Update Resource 15
Slide 16: Mining
Order of Magnitude Study – 2016 Update Mining • Previous mining has left a pre-stripped open pit but remediation required. • Drainage tunnel appears to be working • Base case annual mining rate 100Mtpa • Large primary load and haul fleet: – 2 x 30Mtpa Rope shovels – 2 x 15Mtpa Excavators – 1x 10Mtpa
Slide 17: Pit and Waste Dumps
Order of Magnitude Study – 2016 Update Pit and Waste Dumps • Conceptual 2.2Bt open pit • Conceptual waste rock dumps with 600Mt capacity 17
Slide 18: Ore Processing
Order of Magnitude Study – 2016 Update Ore Processing • Ore processing plant was considered in comminution modules comprising SAG and grinding mills to process 30Mt/y; • Base Case plant comprised two ore processing modules to process 60Mt/y; • Pre-concentration screening at 35Mt/y was specified to e
Slide 19: Tailings
Order of Magnitude Study – 2016 Update Tailings • Previously placed in the Jaba River flowing into Empress Augusta Bay. • Tailings accumulated in the river. The National and Provincial governments approved BCL to construct a pipeline which was completed in 1988-89, to directly place the tailings int
Slide 20: Tailings disposal options map
Order of Magnitude Study – 2016 Update East Coast DSTP options Outfalls >150m depth 4.5km 3.75km West Coast DSTP option Paddock TSF options 4.5km Valley Fill Dam Outfall >150m depth option Existing Tailings pipeline Possible onland pipeline alignments Possible subsea pipeline alignments 20
Slide 21: On land Tailings
Order of Magnitude Study – 2016 Update On land Tailings On Land Option 1: Paddock tailings storage facility • Two areas were identified as potentially suitable for on land paddock dams. • Each of these areas has the capacity to store approximately 1.2Bt of tailings. • Field investigations are requir
Slide 22: Environment
Order of Magnitude Study – 2016 Update Environment Matters to be assessed are: – Potential impact of chemicals, hydrocarbons and asbestos from premature closure. – Upon regaining access it is proposed to undertake baseline environmental and social assessments to inform future options Management of f
Slide 23: Power generation options
Order of Magnitude Study – 2016 Update Power generation options • Base case requires 229MW’ including allowance for community supply; • Coal fired power generation selected as Base Case based on the lowest net present cost; • Gas is an option but adds significant capital cost; • Desktop studies indi
Slide 24: Power generation options
Order of Magnitude Study – 2016 Update Power generation options • Coal and hydropower offer the lowest cost Levelised cost of electricity ($/MWh) electricity generation options. • Insufficient hydrothermal power potential perceived to provide the total project power. • Considerable uncertainty in th
Slide 25: Hydropower generation options
Order of Magnitude Study – 2016 Update Hydropower generation options: • Several potential hydropower sites identified. • Reasonable potential to produce 50 to 60MW of hydropower from schemes on the Laluai and Pagana Rivers; • Operating and maintenance costs relatively low but capital costs relativel
Slide 26: Infrastructure to be upgraded
Order of Magnitude Study – 2016 Update Infrastructure to be upgraded Port SMQ Village Arawa Town Aropa Airport PortMine Port MineAccess Access Road Road Mine 26
Slide 27: Accommodation
Order of Magnitude Study – 2016 Update Accommodation • Comprises a SPQ village for all employees on shift and residential housing. • SPQ Village: – located on the port-mine access road; and, – comprises a 500 bed construction camp as well as the operational accommodation; • Village and Residential o
Slide 28: Organisation and working arrangements
Order of Magnitude Study – 2016 Update Organisation and working arrangements • Structure would be similar to the previous operation with 2487 employees for the 60Mt/y Base case; • Workforce is less than the 3560 employed in 1989 due to the larger mining and processing equipment and more efficient mo
Slide 29: Development Schedule
Order of Magnitude Study – 2016 Update Development Schedule Year 1 Year 2 Year 3 Year 4 Year 5 Year 6 Year 7 Year 8 Pre-feasibility (24 months) Approvals (3 months) Feasibility (12 months) Finance (12 months) Approvals (3 months) Construction (33 months) Production 29
Slide 30: Next Step – Establish the new BCL Re-development Context
Order of Magnitude Study – 2016 Update Next Step – Establish the new BCL Re-development Context • The Order of Magnitude Study was prepared to reflect previous major shareholder standards and expectations; • The new BCL major shareholders may have different expectations of redevelopment. Some possib
Slide 31: Forward Plan
Forward Plan Next Steps • Clarify new BCL re-development context; • Plan appropriate work plan based on new context that could include: – Update order of magnitude assessment; – Establish Arawa office to facilitate community engagement and facilitate commencing site activities: • Landowner Identific
Slide 32: Forward Plan
Forward Plan Further technical de-risking work programme: • Tailings storage facility site investigations; • Resource evaluation drilling programme; • Establish condition of the open pit and mine drainage tunnel; • Assess condition of major infrastructure; • Survey environmental impacts from previou
Slide 33: Summary
Order of Magnitude Study – 2016 Update Summary • Change in BCL major shareholding requires re-assessment of the re-development context. • The OMS describes a project with potential for a long mine life but the capital cost is high. • Once guidance is provided on the shareholders expectations and re-
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