KGL Resources Ltd (ASX:KGL) has received approval from the Northern Territory Government of a Mining Management Plan (MMP) for the 100%-owned Jervois Copper Project.
In welcoming the decision, KGL chairman Denis Wood said this was the major outstanding approval required before the Jervois project’s development.
It provides encouragement as the company has initiated a feasibility study (FS) following the receipt of a positive pre-feasibility study (PFS) for the project.
Strong copper prices
The approval also comes on the back of strong copper prices and an optimistic outlook with prices currently at US$7914 per tonne, having reached US$7968/tonne (US$3.61/lb) last month.
Wood said: “Our current project planning takes into account the conditions attached to the Government response, so this landmark approval provides an essential clearance for Jervois.
“The recently announced pre-feasibility study (PFS) results show that the high-grade Jervois deposit will support a robust initial 7.5-year mining operation.
“We are confident the drilling about to start in the new year will improve the quality and size of the resource.”
Feasibility study priority
The chairman said the new information would be fed into the full FS which now had the company’s highest priority.
“Work is already well advanced on the FS which we expect will improve the economics of Jervois even further.
“With the PFS completed and the authority to mine now in place, discussions have begun on project financing and the marketing of the mine’s concentrate.”
Well placed to enter market
Wood said: “Jervois is exceptionally well placed to enter the world copper market as a supplier.
“It is a high-grade deposit 9.4 million tonnes at 2.41% copper reserve at a time of declining copper grades among the major copper mines and constrained copper production generally.
“At the same time demand is expected to increase strongly for copper in both emerging green energy and electric vehicles uses as well as traditional construction, electricity transmission, communication and consumer goods applications.”