Asiamet Resources Ltd (AIM:ARS, OTC:KMGLF) said further optimisation work for the BKM heap leach project in Central Kalimantan, Indonesia had confirmed staged construction as the best way forward.
Initial optimisation work indicated that moving the heap leach facility pad would reduce bulk earthworks and upfront capital costs.
Following on from this, work has focused on reducing pre-production capital expenditure and execution risk in the initial phase of the BKM mine development.
As a result, the plan now is for the first stage of the BKM Copper Project to be "a smaller capacity, higher-grade, higher margin mine centred around a revised open pit design sitting entirely within the footprint of the 2023 BKM Feasibility Study (FS) pit.
"The new pit design is expected to considerably lower the upfront capital cost and significantly enhance project economics for BKM," Asiamet added in its statement.
Compared to the original DFS plan, the new model decreases total material mined by 47% but gives scope for future expansion.
Other changes include a higher-grade copper being processed and taller leach pads that although reducing the life of mine output boosts early-stage cash flow.
A new design for the heap leach facility will also allow for a much smaller area to be used for stacking operations, reducing upfront costs, Asiamet added.
Darryn McClelland, Asiamet’s chief executive, commented: "The decision to optimise the development of the BKM Copper Project in stage 1 is a prudent approach.
“This approach maximises operating efficiency and minimises upfront capital expenditures while maintaining full flexibility for future expansions.
“A more capital efficient, lower risk approach to developing BKM sets a strong foundation for completing project financing and developing our first copper mine.
“Updated cost estimates for the project will flow through from the detailed design and engineering currently underway with Rexline Engineering and BGRIMM.”