Davis Index: Market Intelligence for the Global Metals and Recycled Materials Markets

First Quantum’s updated Kansanshi technical report showed an increase of 67pc in mineral reserves and 41pc in mineral resources compared to the last report in 2015.


Mineral reserves at the Zambia mine increased from 493mn mt in the previous model to 843mn mt, while mineral resources at Kansanshi increased from 668mn mt to 940mn mt. The life of the copper mine was also extended to 24 years. 


Due to the recognition of additional copper reserves, annual production at the Kansanshi site is expected to increase by 93pc, or 25mn mt, to 52mn mt annually. It has been named the S3 Expansion.


The additional reserves support the the S3 Expansion plan, slated for 2023-2024, with site enlargement expected in late 2024. A lot of work, including to foundations, steelworks and infiltration systems, had already began before activity was halted seven years ago.


The total investment of the S3 expansion is estimated at $650mn. Given its existing infrastructure, the additional capital investment for processing facilities is estimated at $408mn. Investment in the mining fleet is estimated at $242mn for annual mining volumes to increase by 60pc to 80mn bank cubic mt from 50mn. 


Instead of proceeding with the previous plan of constructing a second smelter, copper concentrate grades will be enhanced and the existing high-pressure leach (HPL) circuit will be modified. The Kansanshi smelter will increase by 20pc to 1.65mn mt annually from 1.38mn in 2022-2023 at a cost of $80mn. Concentrate cleaning and HPL plant improvements are estimated at $15mn.


The site had mineral reserves of 843mn mt on June 30, 2020, with about 70pc sulfide ore, 17pc mixed ore, and the remaining 13pc oxide ore, plus 128mn mt of additional stockpile reserves, according to its latest filing. Of the 971mn mt, 304mn mt, or 31pc, are proved while 667mn mt are probable volumes. 


The company warned that the investment and start dates could be delayed or accelerated, depending on capital access and market conditions. 




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