Despite geopolitical tension and the global economic quagmire in the aftermath of Covid-19, Alphamin stuck to its guns and realized its vision of becoming one of the world’s largest sustainable tin producers.
While the company continued to efficiently extract high-grade ore from its Mpama North mine at the Bisie complex in the eastern regions of the Democratic Republic of the Congo (DRC), its extensive exploration programme has delivered excellent results and increased the life of mine at Bisie.
Alphamin now produces more than 4% of the world’s mined tin and with more market volatility and political instability expected in 2023, the company could increase that percentage to at least 5 or 6%.
While wild swings in the tin price and logistical constraints have disrupted most tin mines across the globe, Alphamin continued churning out tin unabated.
It was especially the major tin producers in Asia that had a torrid time in 2022, being hamstrung by repeated lock-downs due to Covid-19 outbreaks and severe bottlenecks at some of the major ports. Those woes continued during the latter part of 2022 despite a market recovery, and is set to be repeated in 2023, at least for the first half of the year.
A growing resource
Being remote, Alphamin was not as badly affected by macro-economics as the other major tin mines around the world. This has put Alphamin in an extremely strong position on the back of a growing resource at Bisie. At a grade of close to 4%, the ore body at Mpama North has delivered some of the highest-grade tin in the world for the last six years.
Moreover, early exploration results obtained from intensive underground drilling programmes, indicate that this high-grade intrusion continues for much deeper than current operating levels. Exactly how deep it stretches is yet unknown, but that Alphamin has stumbled upon an exceptionally rare find remains a fact that cannot be disputed.
Visual intercepts of cassiterite
During the recent Mpama North Phase 2 drilling campaign, visual intercepts of cassiterite were intersected on the southern and eastern extensions of the orebody – many on current mining levels.
These intercepts contain the visual mineralization style characteristic of the Mpama North mine and, although less intensely mineralized than elsewhere, should provide valuable blending material for the deeper high-grade zones of Mpama North, thus potentially extending the life of mine and maintaining current production levels for longer.
What’s more is that early results from exploration drilling at the company’s other deposit, Mpama South, has proven that the ore body might even be better than what Alphamin’s world class geologists initially predicted.
Grades at Mpama South are lower than Mpama North, but nevertheless is regarded as the world’s second highest grade deposit. The early theory that these two ore bodies are connected and interlinked is looking more and more like a geological fact rather than speculation.
If Mpama South turns out to be the sweet spot at Bisie, it will, of course, increase the mine’s resources and reserves significantly, and at the same time extend the Life of Mine of the entire complex with a higher annual production
Progress with expansion drilling
In addition to drilling for resource extensions at Mpama North and Mpama South, Alphamin is also actively exploring for more tin deposits on its license areas.
Resource expansion drilling, resource confidence drilling and new deposit discovery drilling progressed well during the third quarter of 2022 with 9,094 meters drilled.
The Bisie Ridge Phase 1 new discovery drilling campaign saw 2,355 meters drilled completing 17 holes in the third quarter of 2022.
Minor visual cassiterite was intersected in two drill holes while prospective associated chlorite alteration was intercepted in multiple other drill holes.
The Phase 1 campaign has been accelerated with ~90 drill holes planned in fences across the Bisie Ridge on six highly anomalous targets, following which a Phase 2 campaign will delineate any discoveries or else in-fill the most prospective targets.
The Mpama South Phase 6 drilling campaign is the largest single campaign to date on the license and aims to both in-fill and extend the Mineral Resource announced on 30 May 2022. An update to that Mineral Resource is expected in December 2022.
Based on the success of Phase 6 and the still open-ended mineralization showing visual cassiterite and good grades from already received assays, a Phase 7 resource extension campaign will continue upon completion of Phase 6.
Bisie above market guidance
Alphamin produced more tin than stated in the market guidance during the third quarter of 2022. The contained tin production of 3,139 tonnes was in line with the previous quarter and above market guidance of 3,000 tonnes.
A highly mineralised area underground, not previously included in the mineral resource or mine plan due to its structurally complex nature, was successfully mined and processed during the quarter.
This area delivered ore at good tin grades but contained high levels of sulfides which impacted processing recoveries.
With worsening macro-economics the tin price’s roller coaster ride flattened out temporarily in September and October when tin traded at between $20,000/t and $21,000/t. However November is already seeing a recovery, with prices on the 16th of November back at $23,823/t.
The eighteenth annual survey of tin users carried out by the International Tin Association (ITA) estimated that refined tin use in 2021 increased 7.6% to 389,500 tonnes with a strong recovery to pre-trade war highs.
Global supply likely to be constrained
However, estimates showed expected 2022 growth stalling below previous forecasts of 3-4% towards -0.6%. High inflation unexpectedly impacted demand in H2.
Alphamin remains of the opinion that global tin supply is likely to be constrained during the next five years while demand for tin is expected to increase. Therefore, the anticipated production expansion from the development of the Mpama South deposit remains a priority.
The Mpama South project, which is adjacent to the producing Mpama North mine, is expected to produce approximately 7,200 tonnes of contained tin per year effective FY2024 thereby increasing Alphamin’s annual tin production to ~20,000 tonnes.
The project is progressing on schedule for targeted commissioning in December 2023. Overall project completion is at 18.6%, and 84.3% of the procurement requirements have been finalized and ordered. The project is not expected to exceed its total cost estimate of US$116 million.
