Sandfire Resources managing director Karl Simich believes the first half of the 2020 financial year has “marked the beginning of an exciting new growth chapter” for the company.
Perth-based Sandfire started its transformation from a single mine company to a multiple resource entity, with the acquisition of MOD Resources and progress towards completing a feasibility study for the Black Butte copper project in Montana, United States.
As well as growing new projects, its existing operations performed well, with the DeGrussa copper-gold mine in Western Australia delivering 34,988 tonnes of copper and 19,370 ounces of gold.
This output puts the mine on track towards its copper and gold guidance of 70,000-72,000 tonnes and 38,000-40,000 ounces respectively.
“At the operational level, DeGrussa posted another strong set of numbers, despite what continues to be a relatively muted global environment for base metals,” Simich said.
“Another impressive production performance once again drove strong sales revenue, low unit operating costs, robust operating cash flows and strong bottom line earnings, helping us to maintain a period-end cash position of $201.7 million.”
The company is focussed on exploration at the newly-acquired Tshukudu and T3 copper-silver projects in Botswana, following the MOD Resources acquisition.
T3 will be Sandfire’s first new base metal operation outside of DeGrussa, with funding discussions already under way for a decision to be made by the middle of the 2020 calendar year.
“Our expanded exploration campaign in Botswana has already paid early dividends with an exciting new copper discovery at the A4 dome, located just eight kilometres from T3,” Simich said.
“(This is) rapidly taking shape and five diamond rigs (are) currently focussed on delineating this zone.”
Despite short-term challenges for Sandfire such as Tropical Cyclone Damien, and global market shakers such as the coronavirus and its impact on metals demand, Sandfire remains confident for the remainder of the financial year.
“There is no doubt that 2020 has seen a number of new challenges emerge in commodity markets due to the impact of the coronavirus and potential impact on metals demand and global logistics and trade,” Simich concluded.
“Notwithstanding the short-term impacts, we remain positive about the medium-term outlook for copper, which remains fundamental as an essential ingredient for a sustainable, low-carbon future.”