Orion Minerals has requested an immediate trading halt over its shares on the Australian and Johannesburg stock exchanges on the grounds that the company “anticipates making a material announcement in relation to exploration results at its Okiep Copper project.”
The halt follows an announcement by Orion on April 17 that the company was moving ahead with the acquisition of the Okiep Copper project stating “acquisition agreements are in the process of being signed to allow closing in several stages as and when the outstanding conditions precedent are met.”
Specifically, Orion announced that the first phase settlement of R10.9m in cash and R35.1m in Orion shares “will be completed immediately following the South African exchange control approval being received.”
It added that the initial consideration includes the important SAFTA (Southern African Tantalum Mining) mining right which was transferred to NOM (New Okiep Mining) in December last year.
A mining industry source described the Orion trading halt request as “unusual” commenting “if you have good exploration or drilling results you just publish them. You don’t call a trading halt unless you suspect maybe they are about to be leaked.”
Asked about this Orion CEO Errol Smart replied, “this is to meet compliance requirements on the Australian Stock Exchange which is our primary listing. We will be publishing exploration results some of which are exceptional, and it is good governance to ensure there is a level trading field.”
The trading halt is until April 22 and Orion has announced that Smart will host a webinar presentation for investors on that day.
Smart commented on April 17 that, “while we have been able to continue operating on the properties and progressing the projects, we have now moved to finalise the Flat Mines bankable feasibility study on the NOM mining right.
“We are now only awaiting the approval of the water use licence before the project is fully permitted, allowing us to commence mine development. The timing is therefore opportune to complete the acquisition of the mining right before progressing the funding of the mine.
“The conclusion of the BFS report is only awaiting the results of confirmation drilling and metallurgical test work that is currently underway and is expected to be concluded by June 2024.“
Orion took up an option on the Okiep rights in February 2021 in a move intended to diversify its operations in the Northern Cape which at that time were focussed on re-opening the Prieska copper mine.
Development of Orion’s Okiep copper project will be in partnership with the South African government-owned Industrial Development Corporation (IDC) which holds a 43.75% stake in the project with Orion owning the balance.
Advantage of a successful Okiep development for Orion is that it will get the company into copper production and generating cash flow a lot sooner than anticipated from its Prieska Copper project.
That mine is flooded and latest estimate from Orion’s interim results published in December is that it will take “less than 40 months” to dewater the deep level underground workings “at one-third of the full-scale pumping rate proposed in the bankable feasibility study – 2020.“
Dewatering is planned to start in the second quarter of 2024 and Orion intends going ahead with a plan to generate early some production by extracting Prieska’s crown pillar – 105 block – which is shallow and sits above the flooded levels of the mine.
