Gold and copper mining company Barrick has initiated the development of the Lumwana super pit ahead of a $2bn (C$2.71bn) expansion pending a final investment decision.
If approved, the expansion will position the Zambian mine as a significant source of copper supply.
The feasibility study for the super pit expansion is expected to be completed by the end of the year, setting the stage for construction to commence in 2025.
Upon completion, the $2bn project could convert Lumwana into a long-lasting, high-yielding, top-25 copper producer and a Tier One copper mine.
The expansion initially involves doubling the throughput of the current process circuit and subsequently increasing mining volumes significantly.
The plant throughput will increase from 27 million tonnes (mt) to 52mt, effectively doubling the mine’s copper production from 120,000 tonnes per annum (tpa) to an average of 240,000tpa over the mine’s life.
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By GlobalData
The expansion of the processing plant is complemented by a gradual increase in total mining volumes, which are expected to grow from 150mt in 2025 to approximately 240mt in 2028, and then at an average rate of 290tpa from 2030 onwards.
Barrick president and chief executive Mark Bristow said: “We are also planning to build critical infrastructure, including an airstrip and an industrial supplier park. This will enable key suppliers to establish themselves in the area, creating an economic hub that will further fuel growth and development in the wider region.”
To ramp up, the expansion will require around 550 additional workers over the next five years, along with 2,500 construction workers until 2028.
Zambian President Hakainde Hichilema said at the ground-breaking ceremony on Wednesday (2 October): “Mining plays a key role in Zambia’s economic structure, and our partnership with Barrick is creating one team with a shared vision to develop a new economic frontier in the North-Western Province of the country and beyond.”
Assuming a long-term average copper price of $4.13 per pound, Barrick estimates that the project will deliver an additional internal rate of return (IRR) of 20% and an overall mine IRR of more than 50%.
The expansion capital is expected to be recouped within approximately two years of completion. Following the expansion, sales and C1 cash costs are projected to be around $2.36 per pound (lb) and $1.85/lb, respectively, positioning Lumwana in the industry’s top quartile regarding costs, excluding any benefits from by-products.
