A big project starts near Bor
The value of shares on the stock exchange jumped to the Chinese company “Zidjin mining”, as they announced that they would start the exploitation of copper and gold at a new deposit in Serbia.
Shares of the Chinese company, which is the owner of the former RTB Bor, jumped on the Hong Kong stock exchange by 13 percent, and with a subsequent slight decline, the total growth in the value of shares of “Zidjina” was 8.2 percent, reports “Market Watch”.
“Zidjin” previously announced that it had received a permit from the state of Serbia for exploitation in the upper zone of the Čukaru Peka deposit, and that excavations would begin.
Reserves in that zone are estimated at 1.28 million tons of copper and 81 tons of gold, it was announced from “Zidjin”. It is planned to mine about 3.3 million tons of ore annually. According to estimates from the Chinese company, the project will have a production of 50,000 tons of copper and three tons of gold in 2021.
Exploitation at the Čukaru Peka deposit comes at a time when the price of copper on world markets is rising, according to Goldman Sachs. A significant shortage of that metal is expected in the last quarter of the year, and “global copper reserves could fall to a historically low value by the end of 2021,” the investment bank estimates. They expect that the price of copper on the world markets could reach 10,500 dollars per ton by the end of the year, reports “Market Watch”.
As the Minister of Mining and Energy, Zorana Mihajlović, stated earlier, with the opening of the new mine, Serbia will become the second producer of copper and gold in Europe.
Zijin estimates 340,000 tons of copper and 12 tons of gold discovered in Serbia
According to geologists’ estimates, there are about 340,000 tons of copper and 12 tons of gold, Zijin company said in a statement. Geological research and investments in this set, but in the long run a profitable job, continue this year as well, so a new drill for exploratory drilling has recently arrived in the Majdanpek mine for that reason.
In the last two years, the Geology Sector has used RC exploratory drilling as part of exploitation research at surface mines, but an external contractor has been hired for that. The dynamics of excavation at surface mines requires constant monitoring and planning of the quantity and quality of the useful component, which can be a problem in less explored parts of the deposit. The new machine will help in such situations, because geologists will get more precise geological information in a fast, relatively cheap and efficient way in the future.
The new drill will also enable better control of the content of useful components, e.g. copper and gold (grade control), which is already a common practice in the world.
The new “epirok” drill, which records the first working hours and meters in the Majdanpek mine, has a simple design, adapted for work on inaccessible terrain, and at the same time it is reliable and easy to service. It can reach up to 250 meters in depth, although the largest in surface mines are 100 to 150 meters. The wells that it makes, if they are not very deep, can also serve as mines in the preparatory drilling and mining works, it was announced.
Last year, the company Zijin Copper invested around 5.55 million US dollars in geological research. The investment paid off, as the company is on track to increase its resources by an additional 57.76 million tons, with a copper content of over 0.3 percent.
Rio Tinto should pay a higher ore rent in Serbia
Estimates show that Rio Tinto for a period of ten years of exploitation of jadarite ore, if we take into account the prices of three products obtained from it, lithium carbonate, boric acid and sodium sulfate, would earn about four billion euros. In case that the research of Rio Tinto on the profitability of the exploitation of jadarite in the vicinity of Loznica gives positive results, that mining company should be charged a higher ore rent than the valid one in Serbia, which is otherwise very low, according to the domestic public.
Some experts in that field believe that in that case, Australians would not be interested in investing, due to significantly lower profits, and that they have already secured with the authorities in Serbia that the price of ore rent does not increase. Considering that the ore rent for this type of ore that would be exploited in the vicinity of Loznica is five percent, Serbia would collect around 300 million euros in the same period. In the opinion of the expert public, this is an unacceptably low profit, which is why the ore rent should be multiplied.
Privatization advisor Branko Pavlovic says that in concrete but also in all other cases of exploitation of Serbian resources by the company, the principle of the so-called “domicile rent” should be introduced.
– In practice, that means that as much as Australia takes money from foreign companies that have mines in that country, so should the ore rent for an Australian company in Serbia. That ore rent is many times higher than it is in our country. So, if there was justice, the ore rent in Serbia would be much higher for “Rio Tinto” but also for all other foreign companies than it is now – our interlocutor states.
– It is hard to believe that such a large mining company has not already protected itself in the phase of exploration works, ie that it has not already been agreed with the authorities in Serbia that the ore rent is not increased in order to extract as much profit as possible. Otherwise, Serbia should not allow foreign companies to exploit its ore resources at all. What should be done is to engage domestic capacities that would explore the possibility of exploitation not only of jadarite but also of other ores in Serbia. We have experts in that field, what would be necessary is for the state to invest in the procurement of adequate equipment for those jobs. Even if the research proves to be a failed state, it would also benefit from that, because it would have the capacity to deal with that business and make a profit – Pavlovic states.
Considering that lithium is used for the production of batteries for electric cars, Pavlovic thinks that the idea of starting a factory in the vicinity of Loznica that would deal with that is good.
– For that, it is necessary for Serbia to make a joint investment with a foreign company that would provide the necessary technology for the operation of that factory, which would enable its profitability – says Pavlovic.
Economist Milan R. Kovacevic also believes that the ore rent dor Rio Tinto should increase in case it starts exploiting jadarite, stating that its validity in Serbia is very low.
– If we take into account how much damage will be caused if the mine starts working, then it is necessary to provide the state through an increase in ore rent, but also defining the collection of “penalties” in case Rio Tinto deviates from contractual obligations. The damage will definitely be, and that is why it is necessary for the level of ore rent and “penalties” that the state would prescribe to be high – our interlocutor states. In his opinion, the exploitation of jadarite in the vicinity of Loznica should not be conditioned by the opening of a factory of lithium batteries for electric cars.
– Those two jobs should never lean on each other. Whenever something like that happened in our area, it did not give the expected economic results. If there is a market for such products, the business of producing batteries for electric cars should be carried out independently of the exploitation of jadarite in Serbia – Kovacevic believes.
When it comes to the amount of ore rent in Serbia, it is necessary to remind that in January, the Minister of Mining and Energy, Zorana Mihajlovic, stated that the department she heads is in favor of increasing the ore rent. On that occasion, the ministry did not answer Danas’ question whether the Ministry of Finance had been offered a percentage increase in the amount of ore rent. Ore rent in Serbia is among the lowest in the region and amounts to three to seven percent of income. For example, in Croatia it is 10 percent, in Hungary and Romania 12 percent each, and in Slovenia 18 percent of the income.
Erin Ventures and Temas Resources joined in developing of Piskanja Boron Project in Serbia
Piskanja is Erin Ventures’ wholly owned boron deposit in Serbia. Erin Ventures Inc. announced that, further to its news release dated December 17, 2020 in which Erin stated that it had entered into a Letter of Intent with Temas Resources Corp. for the joint development of Erin’s Piskanja Borate Project, the parties have recently concluded their due diligence process with a favourable outcome, and are now working to complete a definitive, binding agreement based on the terms in the LOI. It is anticipated that the definitive agreement will be completed imminently.
Piskanja is Erin’s wholly owned boron deposit with an indicated mineral resource of 7.8 million tonnes (averaging 31.0 per cent B2O3), and an inferred resource of 3.4 million tonnes (averaging 28.6 per cent B2O3), calculated in accordance with the Canadian Institute of Mining Definition Standards on Mineral Resources and Reserves (CIM Standards), as disclosed in Erin’s report titled, “Mineral Resource Estimate Update On The Piskanja Borate Project, Serbia, October 2016 – Amended February 28 2019” – prepared by SRK Consulting (UK) Ltd. The responsible persons for the Updated MRE are Dr Mike Armitage (C.Eng. C.Geol.) and Dr Mikhail Tsypukov who are both full time employees of SRK and Qualified Persons in accordance with the CIM Definition Standards on Mineral Resources and Reserves (CIM Standards), and independent of Erin Ventures.
Share of mining in GDP around 4% is the goal for Serbia
The Minister of Mining and Energy, Zorana Mihajlovic, stated that the value of the mineral wealth of our country is more than 200 billion US dollars.
In an interview for a special issue of Cord magazine dedicated to mining, Mihajlovic explained that this wealth should contribute to economic development and growth – to be responsible for the environment, but also to see the effects of that in the state budget.
According to her, the goal is to attract new investments to Serbia and that in three years the share of mining in GDP will be approximately 4% instead of 1.9%, according to the website of the Government of Serbia.
– In addition, we want the development of mining to be sustainable and that everything that is done in this area is done respecting the regulations and the highest standards in the field of environment – the Deputy Prime Minister emphasized.
– Mining is a sector that has been on the sidelines completely undeservedly for a long time. We want to correct this injustice, because there is much more potential in that area than has been used today – she pointed out.
As she mentioned, the Ministry has prepared a draft of amendments to the Law on Mining and Geological Research, which wants to create conditions for Serbia to get a modern and much more successful mining sector.
She pointed out that one of the goals of the amendments to the laws in the field of mining and energy is to transfer the e-permit system, due to which Serbia is ninth in the world today in issuing construction permits on the World Bank’s “Doing Business List”, to energy and mining.
Reforms of e-energy and e-mining, as she assessed, will bring great changes not only in energy, but also in mining, where the digital procedure in mining in obtaining documentation is being introduced for the first time.
According to her, that means that permits will be issued in shorter terms, on average from the current 150 days to about 15 days, and that investors will be able to follow exactly at what stage their procedure is.
Mihajlovic emphasized that neither mining, nor energy, can progress without new investments, as well as that it is especially important that everything that is done is harmonized with the regulations in the field of environmental protection.
– Our task is to create conditions for that, to have clear and transparent procedures, equal for all investors, and for the state’s interest to be protected, for example when it comes to taking care of mineral resources – she pointed out.
Also, as she added, the same applies to renewable energy sources, where the goal is to better use this potential, which, together with investment in increasing energy efficiency, should enable us to get approximately 50% of electricity production by 2050 from renewable sources, eKapija reports.
Raiden Resources update on progress of its Serbian project
The newly optioned project of Raiden Resources lies in central Serbia, roughly 200 kilometres from the capital Belgrade. It’s divided into two parts, the northern area near Stanca and the southern area in Tolisnica. The last notable work was undertaken at the project in the 1970s when 4411 metres of drilling was undertaken by a Serbian mining company. Raiden Resources has updated the market on the progress of its project in Serbia.
“The company continues to demonstrate the ability to secure quality projects in a very competitive environment. Management is continuously evaluating new opportunities with the objective of generating new quality drill targets for testing,” Managing Director Dusko Ljubojevic said.
“We look forward to getting boots on the ground on the TS project in the following weeks and will kickstart the exploration campaign as soon as the permits are issued by the Ministry of Mines and Energy,” he added.
Mineralisation at Stanca lies in a hydrothermally altered diabase (subvolcanic rock), which generally trends in a north-northwest to south-southeast direction. Copper grades generally range between 0.1 per cent to one per cent, however, up to 6.5 per cent copper has been found at the main mineralised structure. Besides copper mineralisation, Stanca also features anomalous cobalt grades where up to 2000 parts per million (ppm) has been previously identified. Raiden will now evaluate results taken from a mapping and rock chip sampling program undertaken by a previous explorer in 2018.
The Tolisnica permit lies due south of Stanca on the same permit, however, mineralisation is more anomalous. While it is more anomalous and dispersed, the mineralisation is encouraging for further exploration. Historical grades range peaked at 1500 ppm cobalt with up to 733 ppm cobalt achieved in recent rock chip sampling. From 1975 to 1977, 15 diamond holes were drilled at Tolisnica with working intersecting several styles of mineralisation.
Ground magnetic survey
Furthermore, a ground magnetic survey was undertaken in April 2018 by Romanian-based contractor S.C Belevion S.R.L. This survey was identified at both Stanca and Tolisnica and it identified a well-defined magnetic low. The low will be followed-up with mapping and soil geochemistry activities.
Temas’ and Erin Ventures’ strategic partnership for Piskanja Boron Project in Serbia
In order to form a joint development of Erin Ventures’ Piskanja Borate Project located in Serbia, Temas Resources Corp. entered into a letter of intent with Erin Ventures Inc, the Temas company announced.
Piskanja is Erin’s wholly owned boron deposit with an indicated mineral resource of 7.8 million tonnes (averaging 31.0 per cent B2O3), and an inferred resource of 3.4 million tonnes (averaging 28.6 per cent B2O3), calculated in accordance with the Canadian Institute of Mining Definition Standards on Mineral Resources and Reserves, as disclosed in Erin’s report titled, “Mineral Resource Estimate Update On The Piskanja Borate Project, Serbia, October 2016 – Amended February 28 2019” – prepared by SRK Consulting Ltd. The responsible persons for the Updated MRE are Dr Mike Armitage and Dr Mikhail Tsypukov who are both employees of SRK and Qualified Persons in accordance with the CIM Definition Standards on Mineral Resources and Reserves, and independent of Erin Ventures.
The salient terms in the letter of intent as are follows:
-Upon execution of a definitive option agreement, Temas will have the sole, exclusive, immediate, and irrevocable option to earn up to 50% equity interest in Balkan Gold (Erin’s wholly owned subsidiary which holds the license to the Piskanja Boron Project) by expending a total of €10.5 million towards the development of Piskanja, within a 36-month period (subject to acceleration at the election of Temas).
-Upon receiving necessary regulatory approvals, Temas will make a one-time payment of 250,000 Temas common shares and 250,000 share purchase warrants (at $1.00 for 4 years) to Erin.
-The terms of the LOI will form the basis of the Option Agreement, which the parties contemplate will be entered into no later than April 15, 2021.
-Temas has until February 28, 2021 to complete its due diligence regarding Piskanja.
-Each €210,000 advanced to the Project by Temas will earn Temas an additional 1% undivided equity interest in Balkan Gold, to a maximum of 50% interest for €10.5M.
-Upon acquisition of 50% interest in Balkan Gold by completing its expenditures, Temas will be entitled to representation on the board of Balkan Gold, voting rights, and dilution provisions, among other rights regarding the governance of Balkan Gold.
-The Option Agreement will include standard dilution provisions.
-Erin will remain operator on the project until such time as Temas has exercised the Option and earned its 50% interest in Balkan Gold, at which point Temas will become operator of Piskanja.
-During the three year option period, a joint technical committee made up of members from both Erin and Temas will have final say on matters pertaining to programs and budgets.
-This LOI is non-binding, with the terms subject to the parties entering into a binding Option Agreement.
-The Option Agreement will be subject to satisfactory completion of due diligence, applicable regulatory approvals, board approvals, shareholder approvals as may be required, amongst other factors.
“We are extremely excited by this development” said Tim Daniels, CEO of Erin. “Temas is an exceptionally good fit for this project. Not only are they willing to match their funding commitments for Piskanja, with the anticipated equity requirements for project development right through to production, but in addition, they have an experienced management team with like-minded thinking towards the development of Piskanja. Undoubtedly we are stronger with them as our partner.”
Michael Dehn, CEO of Temas stated “having the ability to work on a great project and high demand commodity, that would be the only European production of borates that should add significant shareholder value. When considering Piskanja, alongside our Ilmenite deposits in Canada, we believe that Temas is becoming a very compelling story. Having access to premier projects that could produce products that end up in consumer and industrial products is intended to allow Temas evolve from an explorer to producer.”
Piskanja is located in a historical mining region that has excellent infrastructure for mining including roads, rail, electric power, experienced miners, and is 250 km south of Belgrade, Serbia by paved roads. Erin Ventures reported on August 31, 2010, that it had been granted a license for the Piskanja boron deposit in Serbia by the Serbian Ministry of Mining and Energy. The license includes the entire known historical mineralized area along with a substantial amount of previously unexplored ground.
-Mineral Resources are not Mineral Reserves as they have no demonstrated economic viability. Temas is not aware of any factors (environmental, permitting, legal, title, taxation, socio-economic, marketing, political, or other relevant factors) that have materially affected the Mineral Resource Estimate.
-Inferred mineral resources are considered too speculative geologically to have economic considerations applied to them that would enable them to be categorized as mineral reserves. There is also no certainty that these inferred mineral resources will be converted to the measured and indicated categories through further drilling, or into mineral reserves, once economic considerations are applied.
-Contained metal figures and totals may differ due to rounding of figures.
Effective date of resource estimate February 28, 2019
Assumptions used to derive the cut-off grades in order to meet the NI43-101 requirement for mineral resource estimates to demonstrate “reasonable prospects for eventual economic extraction”.
The estimate assumes:
– An average production of 330,000tpa,
– Mean mining grade of 27.8% B2O3
– All Run of Mine (RoM) ore to report to a Colemanite Plant for Colemanite production.
– A mean mass yield of RoM ore to Colemanite product of 73.8%.
– An average recovery of B2O3 from RoM ore to Colemanite of 92.9%.
– ~ 50,000tpa of Colemanite product (at 35% B2O3) to be subsequently processed to produce 25,000tpa of Boric Acid product with an assumed grade of 56.3% B2O3. The remaining Colemanite product is sold.
– A mean mass yield of Colemanite to Boric Acid product of 49.7% and an assumption that 80% of the B2O3 is recovered to the product.
– A Colemanite (at 35% B2O3) price of USD400/t product.
– A Boric Acid (at 56.3% B2O3) price of USD800/t product.
– Royalty deduction of 5% on gross revenue.
– Other sales and marketing costs of USD1.5/t product sold.
– Total Construction Costs of US$85Million.
– Sustaining Capital Costs of US$19Million.
– Closure Costs of US$15Million
– Operating Costs of US$170/tonne product
Mundoro and Vale MoU on two projects in Serbia
In November 2019, Mundoro Capital granted Vale an earn-in option on four exploration licenses within the Timok Magmatic Complex. Under that deal, Vale can acquire a 75% interest in the projects for total exploration expenditures of $45 million. Mundoro has now expanded its relationship with Vale by signing a binding memorandum of understanding (MOU) on two of its exploration licenses in Serbia, the copper-gold project generator company announced.
The two licenses (Savinac and Bacevica) are located in the southern portion of Timok, which is one of the most prolific metallogenic domains in the Tethyan Belt that extends from eastern Europe, through Turkey to Iran and Pakistan.
Timok hosts the recently discovered Cukaru-Peki deposit and several producing mines: the Bor copper porphyry underground mine and the Majdanpek and Veliki Krivelj copper-gold porphyry open-pit mines. These properties, together known as the Bor mine complex, are currently controlled by China’s Zijin Mining Group.
Under the terms of the MOU, Vale can earn a 100% interest in the projects by spending $2 million on exploration over two years. Should Vale extend the option period for an additional year, it will pay $1 million during such extension year.
Mundoro will be the operator of the projects and receive an annual fee of $200,000 during the option period.
Upon exercise of the option, Mundoro will retain a 2% NSR royalty on the projects, of which Vale will have an option to purchase up to 1% of the NSR royalty with payments tied to the gold price at that time. At the current gold price, the value of the 1% NSR is estimated at $9.2 million.
Following exercise of the option, Vale must also make milestone payments to Mundoro totaling $9 million upon completion of four major milestones, beginning with a resource estimate filing and ending with the attainment of a development permit.
Tethyan Resource’s Kizevak Project of initial drill completed in Serbia
Kizevak project is the silver-zinc-lead project in Serbia. The initial drill program consisted of 11 diamond drill holes for a total of 1,867.5 metres, targeting the confirmation of historical drill and underground assay data. Tethyan Resource Corp. announced the successful completion of this initial drill program on the recently acquired license that comprises the central portion of the Kizevak project.
The results of drilling will be announced as they become available. In the meantime the Company is preparing for a larger drill programme in an effort to define a maiden resource estimate at Kizevak that is intended to commence in September following the anticipated acquisition of Tethyan by Adriatic Metals Plc. Additionally, Tethyan is currently conducting detailed soil sampling, geological mapping, and a ground magnetic survey over the Kizevak and Sastavci projects in order to further support drill planning and exploration of extensions to historically drilled mineralisation.
Medgold Resources to acquire Fortuna Silver Mines’ interest in the Tlamino Project, Serbia
Medgold Resources Corp. has secured an exclusive option to purchase Fortuna’s 51% interest in the Project for a cash consideration of US$ 3.468 million. Medgold announced that it has entered into a non-binding Letter of Intent with Fortuna Silver Mines Inc. to acquire Fortuna’s 51% interest in the Tlamino Project located in Serbia.
The Option is valid for three years and is exercisable upon the earlier of (I) the expiry of the term of the Option, (II) the date of completion of a sale by Medgold of a 100% interest in the Project to a third party, or (III) the date of completion of a merger between Medgold and a third party.
Fortuna will also be entitled to deferred monthly option fees of US$23,000 per month commencing from the date of the Definitive Agreement to the date of exercise of the Option, payable upon exercise of the Option. In the event that the Option is exercised within 12 months of the date of the Definitive Agreement, the Monthly Fees will be fixed at US$276,000. Should Medgold not complete a sale of the Project or corporate merger within the term of the Option, Medgold will transfer its undivided 49% interest in the Project to Fortuna for no consideration, such that Fortuna will then hold an undivided 100% interest in the Project.
If Medgold completes a sale of the Project or corporate merger as described above and receives consideration attributable to the Project in excess of US$ 13 per ounce of the Project’s Inferred Mineral Resource, Medgold will pay to Fortuna an asset sale bonus equal to 10.2% of any amount in excess of US$13 per ounce, less all of Medgold’s costs related to the sale or corporate merger.
The Option is subject to the execution of a definitive agreement to be entered into between Medgold and Fortuna within 60 days of the effective date of the Letter, and will contain terms and conditions customary for transactions of this type. The Option is subject to approval from the TSX Venture Exchange, and the boards of directors of both companies. Medgold and Fortuna have a director in common. Pursuant to the terms of the option agreement between Medgold and Fortuna dated March 6, 2017, and as later amended, Fortuna has earned a 51% interest in the Project by spending US$ 3 million in exploration expenditures, as announced on January 30, 2020.
The Tlamino Project
An Inferred Mineral Resource containing approximately 680,000 oz AuEq in 7.1Mt grading 3.0 g/t AuEq at cut-off grade of 0.7 g/t AuEq was announced in regard to the Barje Prospect on January 30, 2020. As part of this work, bulk rougher flotation tests were performed on two composite samples which, formed of 50.39 kg of core from the Company’s 2018 drilling program at the Barje prospect, yielded head grades of 2.04 g/t Au and 10.99 g/t Au and gold recoveries to concentrate of 88.2% and 90.5%, respectively. The same composite samples yielded silver head grades of 15.1 g/t Ag and 107.2 g/t Ag, and silver recoveries to concentrate of 88.2% and 96.4% respectively.
The Tlamino Project covers an area of approximately 200km2 in southern Serbia and is held by Medgold under two exploration licenses. Outcropping mineralization was first observed at the Barje Prospect by Yugoslav State agencies in the 1950s and 1960s when a short adit was opened but no drilling was carried out. The prospect was then held by private and public companies between approximately 2005 and 2012 during which time limited drilling failed to intersect significant mineralization.
Medgold conducted mapping, surface sampling and geophysics (IP) followed by diamond drilling at the Barje Prospect in 2018 and 2019, all fully funded by Fortuna, which successfully intersected gold mineralization in a shallowly inclined body of hydrothermal breccia below altered schist. The Inferred Mineral Resource at the Barje Prospect extends from surface to a depth of approximately 110m as a shallowly inclined zone over an area of approximately 600 m x 350 m. The true thickness of mineralization generally ranges between 10 m to 40 m.