Savannah Resources nears completion of mineral sands scoping study

JOHANNESBURG (miningweekly.com) – Aim-listed exploration and development company Savannah Resources is nearing completion of a scoping study at its Mutamba heavy mineral sands project, in Mozambique.

CEO David Archer on Friday told Mining Weekly Online that the company was now “moving things forward at a pace that [our joint venture partner] Rio Tinto is really delighted with.”

In April, the miner reported that the project’s Ravene resource was found to contain a high-grade portion of 92-million tonnes at 6.2% total heavy materials (THM), with an inferred mineral resource estimated at 900-million tonnes at 4.1% THM.

This brought the total mineral resource estimate for the Mutamba project to 4.4-billion tons, representing a 26% increase.

Savannah is also nearing construction of a 20 t/h bulk sample pilot plant, provided by Rio Tinto, with first sod-turning for the construction of the mine expected next year.

Archer noted that the project would provide both direct and indirect employment opportunities during the construction phase and operations, with Savannah looking at employing around 300 people on a permanent basis during its operating phase.

He said a key consideration in the company’s achieving operating success in any of its mining jurisdictions, which also include Finland and the Sultanate of Oman, was localisation.

“One of the key elements is to ensure that you are very well represented in the country, particularly employing nationals from those countries. A vast majority of our staff in Mozambique are locals, from the technical and managerial side. This is one of the reasons why we have been quite successful,” he noted.

On the operational side, Archer noted that the company “enjoyed working in Mozambique”, as it had a strong understanding of how the country operated, adding that its country manager Paul O'Donoghue had lived in Mozambique for 17 years.

Highlighting that the administrative requirements in Mozambique “can be somewhat onerous”, he pointed out that Savannah had good relations with the country’s mining regulator and, more broadly, received “very good” support from the government, which was keen on promoting foreign direct investment.

Archer further highlighted that while the development of Mozambique’s oil and gas industry was the most significant focus for investment, the mineral sands sector was a second-tier market for the country, particularly as prices continued to improve.

This, he pointed out, came on the back of strong demand from China for titanium dioxide, as well as an uptick in the US housing market, which would support the demand for paint and other products that use mineral sands.