DEGRUSSA OPEN PIT OXIDE COPPER ORE RESERVE DEVELOPMENT OF...

DEGRUSSA OPEN PIT OXIDE COPPER ORE RESERVE
DEVELOPMENT OF PROCESSING ROUTE PAVES WAY FOR OXIDE COPPER PRODUCTION
HIGHLIGHTS
• Maiden Oxide Copper Ore Reserve (Proved and Probable) for the DeGrussa open pit totalling
1.04Mt @ 2.3% Cu (23,000t contained copper):
o Includes 0.47Mt at 2.0% Cu (10,000t contained copper) already mined and stockpiled.
• This follows the successful development of a processing route for an oxide copper circuit, to
be located proximal to the 1.5Mtpa DeGrussa concentrator.
• Design studies and statutory approval processes underway for the oxide processing plant
and infrastructure, which will have an estimated capital cost of $15-$17M.
• Processing of oxide copper reserves targeted to commence by mid-CY 2013, providing a lowcost addition to Sandfire’s copper production profile.
• Additional Massive Sulphide ore brought forward from the Underground to Open Pit Ore
Reserve, delivering 0.14Mt @ 3.8% Cu (5,000t contained copper).
Sandfire Resources NL (ASX: SFR; “Sandfire”) is pleased to announce that it has commenced design
studies and statutory approvals for an oxide copper circuit at its 100%-owned DeGrussa Copper Mine
in Western Australia following completion of a maiden Oxide Copper Ore Reserve for the open pit,
which is expected to provide a low-cost, high-margin addition to its production profile.
The maiden Oxide Copper Ore Reserve – which totals 1.04Mt @ 2.3% Cu for 23,000t of contained
copper – follows extensive metallurgical testwork which has enabled Sandfire to scope out the design of
a low-cost recovery circuit for the oxide material.
Oxide Copper Processing Plant
Investigations into a suitable processing route for the oxide copper ore commenced in 2011, culminating
in successful bench-scale processing to produce a saleable concentrate. This has enabled conversion of
the higher grade portion of the previously announced Measured and Indicated open pit Oxide Copper
Mineral Resources to Ore Reserves.
The proposed Oxide Copper Processing Plant will include crushing, wet scrubbing and screening to
three size fractions, followed by gravity separation at a scoped processing rate of 350-400,000 tonnes
per annum. This will produce an intermediate concentrate suitable for further batch treatment in the
1.5Mtpa DeGrussa concentrator through the addition of sulphidising agents allowing conventional
flotation.
Testwork completed to date indicates that approximately 40% of the material will be removed by the
oxide plant, resulting in a 50% increase in grade ahead of delivery to the DeGrussa concentrator. 2
ASX / Media Release 16 July 2012
Testwork is continuing aimed at further refinement of the processing route and enhancement of the
metallurgical performance of the proposed oxide plant. The objective of this testwork is to deliver further
conversion of in situ Mineral Resources (including current lower grade stockpiles) to Ore Reserves.
Figure 1 – Oxide ore from the open pit
Sandfire considers that the DeGrussa concentrator will have sufficient capacity to process the
sulphidised intermediate oxide material in addition to the 1.5Mtpa of underground massive sulphide ore
during the early years of operations.
Subject to final engineering studies, it is estimated that the construction of the Oxide Copper Processing
Plant, infrastructure and integrating modifications to the DeGrussa concentrator required to integrate the
new processing circuit will incur a capital cost in the order of $15-$17 million.
Scoping level estimates indicate an operating cost of around $10-$12 per tonne of Oxide Copper Ore
Reserves and completed initial testwork indicates an overall metallurgical recovery to saleable
concentrate of 73% of the contained copper of this material.
First production from the Oxide Copper Ore Reserve is planned to begin in mid-CY2013, in addition to
the previously announced annualised production profile in the first three years of operations of 77,000tpa
of copper and 36,000ozpa of gold.
DeGrussa Open Pit
A significant portion of the Oxide Copper Ore Reserve has already been mined and stockpiled as part of
the DeGrussa open pit operations, which commenced in May 2011. As at the end of March 2012, 0.47Mt
of copper oxide ore grading 2.0% Cu and 0.7g/t Au had been mined from the open pit and stockpiled in
close proximity to the planned Oxide Copper Processing Plant.
Chalcocite below the DSO cut off grade and massive sulphide from the open pit will be stockpiled and
processed during the commissioning and initial production phases of the 1.5mtpa on-site concentrator
commencing in Q3 CY2012.
At the base of the Stage 2 Open Pit is 0.14Mt of massive sulphide ore at a grade of 3.8% Cu which was
originally included within the Underground Ore Reserve but which will now be mined in the Stage 2 open
pit and is planned to be processed in mid-CY 2013.
As a result of this massive sulphide now being mined as part of the open pit and the maiden Oxide
Copper Ore Reserve, the overall Open Pit Ore Reserve for the DeGrussa Project, stated as at 31 March
2012, total 1.63Mt @ 4.9% Cu, 1.2g/t Au for 79,000 tonnes of contained copper and 64,000 ounces of
contained gold.
Further detail of the open pit Ore Reserves is provided in Table 1 and a schematic representation of the
distribution of the reserves is shown in Figure 2.
DeGrussa Laterite Gold Processing
Sandfire is also pleased to advise that it has signed an Ore Sale and Purchase Agreement with Barrick
(Plutonic) Ltd to process the lateritic gold material mined as part of the open pit operations. Some 0.1Mt
of this material at an average grade of 3.0g/t (9,000oz contained gold) has been mined and stockpiled.
The current schedule for this material, which is included in the Reserve Statement in Table 1, is to be
processed before the end of CY2012.


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