Orion Minerals is developing a sustainable pipeline for critical minerals production in South Africa's Northern Cape province.
The joint ASX-JSE-listed junior miner recently released definitive feasibility studies for its Prieska Copper Zinc Project (PCZM) and Okiep Copper Project (OCP). The company also announced a non-binding term sheet with Glencore for financing of US$200 million to US$250 million and offtake of copper and zinc for PCZM. Orion plans to have concentrate production in the market by January 2027.
Eight years after Orion acquired prospecting rights in South Africa, the transition from gold exploration in Victoria is paying off.
'We are well-positioned to accelerate towards production at our flagship long-life and financially robust mining operation in South Africa's Northern Cape, when the proposed agreement with industry major Glencore is finalised,' says Orion's Managing Director and CEO, Tony Lennox.
'As we progress to a base metal producer, we will explore opportunities to leverage Australian expertise in mining and technology while enhancing our commitment to the economic empowerment of our host communities.'
Modern mining approaches offer commercial and sustainability benefits
Prieska and Okiep are both brownfield projects. The mines closed between 20 and 30 years ago. Shallower reserves were depleted, and declining copper prices made it uneconomical to access the deeper ore bodies.
Growing demand for critical minerals and improved mining techniques have made the mines viable again.
New technology will allow Orion to access the deeper reserves underground. The use of modern paste fill support will also minimise waste and environmental impacts, explains Marcus Birch, Executive: Sustainability & Business Support.
The mines will both leverage existing infrastructure and benefit from recent renewable energy projects. Analysis using AI systems and automation will make extraction more productive. AI tools also allow much closer monitoring and fine-tuning at all stages. This makes processing more efficient and tailings management more effective.
Orion estimates these measures could improve efficiency by up to 15%, resulting in improved economic returns.
Investing in community
The region has seen very little economic development since the previous mines closed.
'The social licence to operate is critical everywhere, but it's particularly so for us here in South Africa where we're operating in economically impoverished areas,' notes Birch.
Right from the start, Orion took deliberate steps to ensure social and environmental sustainability.
Orion set aspirational targets of 50% for local employment and 30% for procurement from community-owned businesses. Most employment and supply opportunities will only start when the mines move into production. Managing community expectations about those opportunities has been an ongoing process.
'We've had to educate local businesses about the kinds of capabilities we'll need, and work with them on training and development to bridge skills gaps over time,' explains Birch.
The company has been seeking expressions of interest and offering training and experience. For example, young school leavers with an interest in mining have been offered psychometric testing and basic underground mining qualifications. Some were also employed for a short-term trial mining project.
Helping the community to prepare gives Orion the benefit of a pool of trained employees with 6 to 9 months' underground experience when production begins. It plans to offer bursary programs and other training for the additional skilled roles it will need.
Orion is deeply involved in the communities in which it operations, providing education and training and sourcing from community-owned businesses.
Building capability for local service providers
Orion is also working with host-community-owned businesses like Quebar Electrical and Civil Construction. Quebar was engaged for electrical engineering work on the Prieska mine and has since become the mine's go-to electrical engineering contractor. It employs over 40 people, including 9 women from the local community. Thanks to the underground experience gained at Prieska, Quebar is now well-placed to pursue other projects.
Austrade connects with skills and support services
As Orion moves from exploration to production, Austrade has helped create awareness of the project in South Africa. Austrade has connected Orion with Australian companies with expertise ranging from survey technologies to delivering remote education programs.
Partners have also helped support local community programs. Austrade collaborated with Orion and Qantas to support Zenisha's Play and Learning Centre. Founded by Zelna Barend, the community charity assists children and adults with disabilities, including Fetal Alcohol Syndrome, in a region where services for people with disabilities are almost non-existent.
Austrade arranged for Zelna to fly to Australia in 2023 on a ticket sponsored by Qantas. She attended the Australian Mining in Africa event, where Orion held a dinner to introduce her to miners that could potentially help her expand and keep operating her charity.
Opportunities for other Australian businesses
The South African Government is keen to position South Africa as a global supplier of critical minerals. It supports investment in the industry and encourages adding value close to the source of production.
South Africa's economic empowerment strategies mean businesses entering the country would need to bring skills transfer or capacity building. That could mean partnering with a local community-owned business, for example.
For Orion, the key to success has been to invest in sustainability and social licence from the outset.
'Business in South Africa is very relationship-based, and it can take time to develop those relationships,' says Lennox. 'These are long-run issues. But then, any mining operation is a long-run investment that takes time.'
