Achmmach

Achmmach is blessed with a world class tin resource endowment. With over 120,000 meters of drilling and estimated 160,000 tons of tin at 0.7% grade, its orebody is one of the largest and highest-grade tin deposits globally, with further potential to grow along strike and depth.

The 2018 Definitive Feasibility Study and subsequent 2019 FEED and ITE reports demonstrate the strong economic potential of Achmmach, supported by low capital intensity and operating costs. Various value-add opportunities have been studied since, including the 2020 Scoping Study which suggests potential for 20 years of production from the existing mineral inventory, as well as potential for mining and processing efficiencies, dry stack tailings and integrated smelter. An updated 2023 Feasibility Study is underway to crystallize these optimizations into an even more robust and compelling design, as the company positions the project for construction in the short term.

2018 Definitive Feasibility Study (DFS)

In July 2018, the Group announced the very positive results from the 2018 DFS of the Achmmach Tin Project, including:

• Post tax NPV of US$98.1 million, with a 23% IRR using a tin price of US$21,000 per tonne and an 8% real discount rate
• Every additional US$1,000 increase in tin price increases Project NPV and ungeared returns by approximately US$20 million and 3% respectively
• Initial capital cost of US$96.4 million
• C1 cash cost of US$9,176/tonne of tin, and a payback period of 4 years
• All-in sustaining cost (AISC) of US$11,435/tonne of tin
• 7% increase in Ore Reserve Estimate to 7 million tonnes at a grade of 0.82% and a 4% increase in contained tin to 58,000 tonnes
• Initial 10-year mine life via underground mining operation, with orebody open along strike and at depth providing excellent near mine exploration potential
• Ore sorting and high-pressure grinding rolls (HPGR) technology increase tin recovery, lower environmental footprint and result in better investor returns
• Overall tin recovery of 77%, with annual tin production of approximately 4,500 tonnes of tin in concentrate, averaging 60% tin

2019 Front End Engineering and Design (FEED)

During FY2019, as a precursor to entering into an Engineering, Procurement and Construction (EPC) contract with reputable, credit worth engineering firms, the Company undertook a request for proposal for the Front-End Engineering and Design (FEED) scope. The FEED aimed at enhancing and improving the design and efficiencies in the processing plant, thereby reducing risk and targeting an improved EPC price for the construction of the processing plant.

The scope of the FEED included:

• Optimisation of the process plant layout and design;
• Increase in equipment sizing to reduce the risk of bottlenecking in the processing plant; and
• Reduction of project schedule through effective planning and optimisation of construction strategies.

The FEED resulted in a number of proposed improvements to the Achmmach Tin Project, including:

• Optimisation of the process flowsheet with addition of best practice tin process equipment in the spirals and tin flotation;
• Reduction in the overall project costs through efficient design and effective sourcing of materials, including from the Mediterranean region; and
• Relocation of the crushing plant and processing plant and introduction of overland conveyors to minimise earthworks and concrete quantities, reducing geotechnical risk.

The improvements and higher level of engineering design and cost detail provided further confidence in the project and confirms that capital costs of the project are within range included in the 2018 DFS. The FEED provided a well-defined scope of work for competitively tendering the EPC contract when the project progresses to implementation, along with further engineering design and project optimisation in a lead up to a project construction decision.

2019 Independent Technical Specialists Report (ITSR)

Following completion of the FEED, the Company engaged AMC Consultants as the Independent Technical Expert (ITE) to complete an Independent Technical Specialists Report (ITSR) for the Achmmach Tin Project.

The ITSR was performed based on the 2018 DFS, the 2019 FEED as well as other supplementary information from work performed since the release of the 2018 DFS, including additional ventilation and geotechnical reviews.

The ITSR confirmed the technical viability of the 2018 DFS and provided certain recommendations around additional optimisation opportunities for consideration as the project is advanced towards development.

Life of Mine Optimisation Study

In February 2020, the Company completed an internal assessment of cut-off grade optimization for the project, looking to maximize value from the existing resource base at the Meknes orebody.

• Post-tax NPV of US$117 million, with a 20% IRR using a tin price of US$21,000 per tonne and an 8% real discount rate
• Initial capital cost of US$104 million
• C1 cash cost of US$10,401/tonne of tin
• All-in sustaining cost (AISC) of US$12,260/tonne of tin
• Mineable mineral inventory of 14.5 million tonnes at a grade of 0.67% with total 70,000 tonnes of tin produced over 20 years of operation, and further potential to expand
• No changes to mine design philosophy and flowsheet from the 2018 DFS
• Potential for further capital and operating cost reductions given enlarged scale and continuity of mineral orebody, allowing for more efficient mining and ore handling through ore sorting

Permits and Licenses

Mining License

In January 2022, the mining license of the Achmmach Tin Project (license d’exploitation No.332912) was successfully renewed for a further 10-year period to 17 January 2032. The renewal of the mining license demonstrates the continued support of the local and regional governments of Morocco.

Environmental and Social Impact Assessment

The Environmental and Social Impact Assessment (ESIA) for the Achmmach Tin Project was completed in 2014 and in 2019, was renewed for a further five years. The ESIA is a critical permit required to operate and sets out the fundamental environmental and social compliance framework. The renewal confirmed the Company's compliance with Moroccan environmental and regulatory requirements and reaffirms the Moroccan authorities support for the project. The renewal of the ESIA was an important step in securing the tenure of the mining license. 

Environmental and Social Impact Assessment