Meridian Mining (MNO) - Copper Gold Recovery Rates Delight

Meridian Mining UK S aims to become the next mid-tier copper developer and producer in Brazil with its focus on the development of its Cabaçal copper/gold project in the state of Mato Grosso.  The Cabaçal copper/gold project is an advanced stage district-scale VMS deposit, which was discovered in 1983 by BP Minerals. The deposit contains broad zones of coalescing Cu-Au mineralization which starts close to the surface and is open at a depth of 175 m whilst extending 2,000 m along strike.

The company announced on the 12th of July 2022, that it had intercepted another high-grade gold vein set which overprinted the VMS copper-gold layer of the Cabaçal North-west Extension. The assay results have served to confirm that the Cabaçal North-west Extension hosts various high-grade vein sets.

Meridian Mining UK S also announced on the 13th of July 2022, that all of the outstanding warrants of the company, which were issued as part of the company’s private placement offering on the f July 2022, have been exercised resulting in the aggregate proceeds of CAD$ 5.2 million towards the company.

Meridian Mining UK S on the 20th of July 2022, released the preliminary metallurgical test work results of the Cabaçal copper-gold VMS project’s mineralization. The metallurgical test work was conducted by SGS Lakefield in Canada. The metallurgical results have shown the simple processing system required by the project to produce high-grade concentrate. The highlights of the metallurgical test work include the achieving of a high-grade 29% copper concentrate, with preliminary recoveries of 94% for copper and 87% for gold. The test work has also shown significantly higher recoveries than what the company achieved in 2009.  The test work has also found that the grind size necessary to liberate the copper-gold mineralisation is a coarse grind size of 200 microns. The coarser grind size, results in less milling necessary realising an energy saving.

Cabaçal project exploration update and Exercising of Warrants

Meridian Mining UK S on the 12 of July 2022, announced that it had intercepted another high-grade gold vein set which overprinted the VMS copper-gold layer of the Cabaçal North-west Extension. The Cabaçal North-west Extension has a strike length of 1,250 km and hosts previously delineated high-grade gold veins.

The assay results have served to confirm that the Cabaçal North-west Extension hosts various high-grade vein sets, hosting high-grade gold overprinting the copper-gold VMS system. The highlights of the assay results include a mineralisation interval of 2.3 m containing 2.2% copper and 16.7 g/t of gold.

The company also announced on the 13 of July 2022, that all of its outstanding purchase warrants, which were issued as part of the company’s private placement offering on the 1of July 2020, have been exercised. The warrants, which were all exercised before their expiry date, have resulted in the aggregate proceeds of CAD$ 5.2 million towards the company.

The purchase warrants entitled the holder thereof to purchase one common share of the company at CAD$ 0.11 and were scheduled to expire on the 1 of July 2022. The proceeds of the exercising of the warrants will be implemented towards the company’s ongoing exploration programs and for general working capital purposes.

Metallurgical work

Meridian Mining UK S on the 20t of July 2022, released the preliminary metallurgical test work results for its Cabaçal copper-gold VMS project’s mineralization. The metallurgical test work was conducted by SGS Lakefield in Canada. The metallurgical results have highlighted the simple processing system required by the project to produce high-grade concentrate. Gilbert Clark, the Executive Chairman of the company sums up the metallurgical results as follows:

“We knew from the storable data that we had fantastic metallurgy, even at low grades, because we had the ramp-up mill in our setting where we had 0.3% copper and 0.2% gold, which showed, essentially, that it was producing quite high recoveries. We said, we're not here to sit around and just take in big corporate costs, we're there to develop a project.”

The highlights of the metallurgical test work include the achieving of a high-grade 29% copper concentrate, with preliminary recoveries of 94% for copper and 87% for gold. The test work has also shown significantly higher recoveries than what the company achieved in 2009.  The test work has also found that the grind size necessary to liberate the copper-gold mineralisation is a coarse grind size of 200 microns. The coarser grind size, results in less milling necessary realising an energy saving. The metallurgical results have also confirmed the viability of an eco-friendly and simple separation system consisting of the flotation of Chalcopyrite via a frother and collection by Xanthate. The metallurgical results combined with the high-grade shallow mineralisation of the Cabaçal copper-gold VMS project has served to highlight and support the project’s open-pit potential. Clark explains the significance of the metallurgical test work as follows:

“Today's news release has set the benchmark going forward for all companies. I can't give you an equivalent, we are now the benchmark - high recoveries, 90%+, and a copper concentrate at 29% with 0.5 ounces of gold. This is just fantastic stuff.”

The significance of the metallurgical test work is its effect on the capital and operating costs of the envisioned Cabaçal copper-gold VMS project. The coarse grind required to liberate the copper-gold mineralisation, the project’s Bond Work Index of 11.2 and the project’s Abrasion Index of 0.28 indicate low operational costs, as Clark explains:

“Most importantly in all these studies, and this really affects the CAPEX and the OPEX, to stay in business capital, is our bond work index, which is how much energy you need to break the rock, that came in at 11.2, and that is incredibly low. That means that we only have to crush it to 200 microns. It takes a very small amount of energy and it is very quick, around 16 minutes or so to gather the metals, and the end product is free of deleterious material.”

Moving forward in a difficult market

The significant results of the metallurgical test work have shown the potential the Cabaçal copper-gold VMS project possesses. The current market conditions, which sees all mining companies experiencing a drop in share price due to the price of most metals being down, have only shown the project’s durability according to Clark as he explains:  

“…there are two ways that a CEO can respond to this. Firstly, I can batten down and just stop everything because my project is never going to be fundable, as the basic economics that are produced show that, with these lower prices, it's not going to work, or in our case, we put out, in one of the poorest markets in recent times, the basic parameters of a mine that regardless of the commodity price, is always going to be producing cash flow, potentially cash flow positive.”

Clark states that the greatest risk investors face with other projects is the project’s dependency on the commodity price. The Cabaçal copper-gold VMS project however is not dependent on commodity prices and shows the project’s durability and constructability, Clark states:

“…if you need high commodity prices to overcome low grades or poor metallurgy, you don't have a project. It's a con in the junior market, and I've said this time and time again, what we're proving to market, regardless of commodity prices, is this will become a producing mine, because we can see the grade, the orientation, the open pit nature, it starts at surface, high recoveries, great product. Just focus on building this mine.”

Future

The company plans to continue with advancing the Cabaçal copper-gold VMS project in the future, with it underway with risk analysis studies. The company plans on completing as well as publishing economic studies of the project, whilst progressing the project to the next phase of engineering. Meridian Mining UK S plans on initiating the engineering cost studies of the project in the fourth quarter (Q4) of 2022, with it planning to implement the results of its ongoing drill program towards an updated mineral resource estimate in the first quarter of 2023, Clark sums up the company’s future initiatives as follows: 

“We've earned our resource study, we're doing risk analysis now on going down to the next phase of engineering and economic studies. When you go into those studies, you want to identify your macro risks, to ensure that you apply the right amount of time to address those risks, whether they be equipment sizing, mine scheduling, environmental concerns, etc. We've been doing that and we signed an agreement with one group recently to actually assess that risk, so we can make the judgement to go forward. We will then continue to drill, we start the engineering financial studies in Q4 this year, with a resource upgrade in Q1 of next year on Cabaçal. We hope to have our first resource statement on Miranta Da Serra in Q1 of next year as well.”

Clark believes that the probability of the Cabaçal copper-gold VMS project going into construction and ultimately operation is very high, with him explaining that the risks associated with the project are low. The project is also supported by the local community and as such adds to the low-risk of the project, he states:

“We don't have any NGO risk, we will become a mine. We're not stuck in the Amazon jungle, we're not in an area of sensitivity. We don't have access problems or acid drainage problems. The modern mining industry is just a net creation of wealth and of dividends, and the largest dividend, of course, is paid to the local community with respect to jobs and so forth. That's what we're presenting with our equities.”

Clark sums up the Cabaçal copper-gold VMS project as follows:

“…this is a production asset we're developing. We've got the metallurgy, we've got the grade, we've got the location, we've got the power, you can't get better than that.”

To find out more, go to the Meridian Mining website