Rising metal prices in 2020 and early-2021 have led to the resumption of exploration and development activities all over the globe, including many projects located closer to home than you might expect. Within the UK right now there is an incredible, sixteen companies, actively seeking to explore for metals and/or develop mines.
These projects are in a range of metals that can broadly be separated into four main groups: speciality and base metals projects focused in the Southwest of England (Figure 1) and North Wales (Figure 2); battery metals projects, which are also focused on Cornwall; precious metals projects focused in Northern Ireland and Scotland (Figure 2) and agri-minerals, located in North Yorkshire.
Figure 1: Speciality and Base Metals Projects (shown in blue) and Battery Metals Projects (shown in green) in the Southwest
Source Mining and Metals Research Corporation
Figure 2: Precious Metal Projects (shown in yellow) and Agri-Mineral Projects (shown in red) in the North
Source Mining and Metals Research Corporation
These projects are being developed at a critical time for the UK’s economy, which is suffering from rising unemployment and spiralling national debt. While mining has an unquestionable impact on the immediate environment around an orebody during the period that the mine is operational, it is a temporary use of land. Rehabilitation management and conservation measures that can be taken before production even commences can actually have a net positive effect on the local environment around a mine.
Mines also create skilled and high-paying direct jobs and secondary indirect and supply chain jobs, as well as providing the raw materials that are essential to every sector of our economy, while also generating taxes and royalties for local, regional and national governments.
A well-regulated mining industry can provide a country with huge economic benefits from a relatively small and temporary environmental footprint, so let us take a closer look at some of these projects.
Tungsten West Limited (TWL)
Tungsten West Limited (TWL) is a UK private company that is planning to resume operations at the Hemerdon Tungsten-Tin Mine, located in South Devon. The Hemerdon Mine, also known as Drakelands was formerly operated by Wolf Minerals who went into receivership in 2018 after having invested over £200 million into the project.
Tungsten West acquired the project in December 2019 for £10 million, and since acquiring the operation, the company has focused on gaining a greater understanding of the mineralogy and metallurgy of the deposit to avoid the processing plant issues faced by the former operator. Following its initial assessment, the company believes that the ore sorting and the front end of the plant need redesigning and initial estimates suggest that this might cost around £40 million.
While the company needs to complete additional metallurgical and processing studies before the operation can resume, once it does Tungsten West is confident it will be at the lower end of the cost curve and be able to generate significant levels of cash flow for the company, which mean taxes for the government, as well as high levels of employment for the local area.
Cornish Metals Inc (LON:CUSN) recently completed a dual listing on the AIM market, in addition to its TSX-V listing, raising £8.2 million. The company plans to use the funds raised to undertake a drilling programme at its United Downs Copper-Tin Project, located in Cornwall, to determine the resource potential of a 1,000-metre-long target.
United Downs is located immediately adjacent to four former copper and tin producing mines: Consolidated Mines and United Mines to the west; and Mount Wellington and Wheal Jane Mines to the east. Initial drilling of the area in April 2020 resulted in the discovery of new zones of high-grade copper-tin mineralisation in a previously unmined area between the historic United Mine and Consolidated Mines.
In addition to the United Downs Project, Cornish Metals also owns the South Crofty Tin Project, located close to United Downs. South Crofty is one of the highest-grade undeveloped tin resources globally with a long history of mining, from 1592 until the most recent operation stopped in 1998. The project has an active mine permit valid until 2071 and importantly planning permission to build a new process plant, as well as an environmental permit to dewater the mine. South Crofty could form a processing hub for United Downs and other projects within reasonable transport distance.
Strategic Minerals PLC’s (LON:SML) is developing the Redmoor Tungsten-Tin Project, located in northeastern Cornwall. The original Redmoor Mine was first operated in the 18th century continuing until 1892 when it was forced to close due to low tin prices, with operations resuming between 1907 and 1914 and again in 1934.
Strategic Minerals completed a scoping study at the project in 2020, which returned a post-tax internal rate of return (IRR) of 28.6% and a post-tax net present value using an 8% discount rate (NPV8) of US$128 million assuming a production rate of 600,000 tonnes per annum, over a potential mine life of 10 years. The company is currently assessing targets to the west of the current resource estimate to increase the scale of the potential operation at Redmoor.
Cornish Tin Limited is a private exploration company focused on advancing the Great Wheal Vor Copper-Tin Project, located in Cornwall. Underground mining first started at the Great Wheal Vor Mine in the 15th-century and continued until 1715 producing mainly copper. Operations resumed intermittently between 1854 and 1910 producing both copper and tin.
Cornish Tin has completed an extensive desktop research programme that has resulted in the definition of several exploration targets within the project area. These targets are associated with the known lodes of the old mines based on historic mine plans.
Cornish Tin is planning a three-phase drilling programme to define a mineral resource estimate at the project. Phase 1 is expected to commence in the first quarter of 2021 (Q221), consisting of 30-40 relatively shallow holes (7,500 metres).
Anglesey Mining PLC (LON:AYM) is advancing the Parys Mountain Copper-Zinc-Lead-Gold-Silver Project, located on the island of Anglesey in North Wales. A recently completed preliminary economic assessment at the project returned a post-tax NPV10 of US$92.1 million and a post-tax IRR of 23.6%. The operation is expected to extract 11.5 million tonnes over a twelve-year mine life producing zinc, copper, lead and gold concentrates.
Anglesey has identified several areas for further improvement and will continue to evaluate and optimise the alternative cases and initiate the necessary work to move towards completing a preliminary or a definitive feasibility study.
Cornish Lithium (PRIVATE:CORN)
Cornish Lithium (PRIVATE:CORN) is a private exploration company exploring for geothermal lithium brines within Cornwall to create a new high-tech, environmentally responsible mining industry in the region. The company has the rights to explore for lithium over a vast area of 300km2, the largest unified exploration effort ever conducted in Cornwall.
The company’s most advanced project at the United Downs Geothermal Power Project is in collaboration with Geothermal Engineering Ltd. The partners were recently awarded £4 million in funding from the UK Government's 'Getting Building Fund’ to build a pilot direct lithium extraction plant at the United Downs site to extract lithium from the geothermal waters, which circulate naturally at depth in the granite rock that underlies Cornwall.
Cornish Lithium is also evaluating the potential for extracting lithium from a recently operational china clay pit at Trelavour Downs, St Austell. In 2020 the company completed a 41-hole drill programme and extensive metallurgical testing, successfully producing nominal battery-grade lithium hydroxide. A second drill programme is now underway with 1,500 metres of diamond and 2,500 metres of reverse circulation drilling planned to produce a maiden mineral resource estimate. The company also plans to commence bulk metallurgical testing, as well as the construction of a pilot plant at the project.
British Lithium Limited is a private UK company developing the Cornish Lithium Project, located in Roche, Cornwall. The company has completed two drilling programmes at the project and has made a significant discovery of hard rock lithium mineralisation from the surface.
The company commenced pilot grinding and screening of an 11-tonne bulk sample of Cornish Lithium-mica granite in December 2020. British Lithium is now further developing its metallurgical laboratory in Cornwall with the addition of beneficiation, pyro-metallurgical and hydro-metallurgical equipment - a first of its kind in the UK
Scotgold Resources Limited (LON:SGZ) is ramping up production at its newly commissioned Cononish Gold-Silver Mine, located in Scotland. The mine is expected to produce between 8,700 oz Au (gold) and 7,800 oz in 2021 and has created over 60 jobs. A fully funded expansion of the operation is planned to be completed by May 2022, which will see production levels double to 23,500 oz gold per annum.
Scotgold is also ramping up its regional exploration programme, as well as completing additional data modelling on three targets close to the mine to establish the best sites to test these targets in future drilling programmes.
Galantas Gold Corporation (LON:GAL)
Galantas Gold Corporation (LON:GAL) owns the Cavanacaw Gold Mine, located in Omagh, County Tyrone, Northern Ireland. The former open pit operation has, after a lengthy delay, secured the planning permits to resume mining activities at the site by making the transition to an underground operation.
About a kilometre of underground development has been completed so far and the company is actively working with third parties on the financing arrangements required to recommence and expand blasting underground.
Dalradian Gold is a private company developing the Curraghinalt Gold Project, also located in Omagh, County Tyrone, Northern Ireland. Dalradian has spent £130 million in Northern Ireland since 2009 and has been seeking the required permissions to mine the project since 2017. In 2020 Infrastructure Minister, Nichola Mallon, ordered a public inquiry into the application for planning permission and at present the future of the project remains uncertain.
Koza Limited is a private Turkish company that has an 80/20 joint venture with GreenOre Gold at its Aberdeenshire and Ayrshire Gold Projects, located in Scotland. At the Aberdeenshire project gold-bearing anomalies, trending northeast-southwest, have been defined over a strike length of 5 kilometres (km) with four magnetic anomalies defined. Drilling has confirmed the presence of gold-bearing veins.
A follow-up exploration programme for 2021 is currently being designed and will include deep overburden sampling and drilling. Work will commence as soon as lockdown restrictions allow and permitting has been secured.
GreenOre Gold PLC is a private exploration company with interests in four projects, located in Scotland. Two projects are part of a joint venture with Koza Gold, while one is part of a joint venture with Erris Gold Resources.
GreenOre Gold also owns 100% of the Kerry Road Gold deposit, located within the Gairloch Gold Project, in northwest Scotland. In the late-1970’s early-1980’s over 9,000 metres of drilling was conducted at the project defining a horizon rich in gold, copper and zinc. GreenOre is confident that the deposit is now of economic interest and the surrounding area could contain further discoveries. Greenore is planning to undertake metallurgical test work of the ore and will continue to explore for additional mineralisation along the trend.
Erris Gold Resources is a private exploration company that has the option to earn up to 80% of the Loch Tay Gold Project, located in Perthshire, Scotland, with GreenOre Gold holding the balance. Erris has received encouraging initial results at the Corrie Buidhe Silver Mine area, discovering gold in the dump of the old mine. At the Lead Trial Prospect, the company has outlined an extensive area of well-developed quartz vein stockworks and localised hydrothermal breccias over a distance of at least 400 metres. A work programme including systematic soil sampling has commenced that will aim to link the two areas into a coherent major target area extending over 3 km.
Western Gold Exploration (CVE:WGLD) is developing the Knapdale Gold Project, located 50km south of Oban in West Scotland. Knapdale is an early exploration stage project prospective for orogenic quartz-gold-silver mineralisation with a 15km2 zone of anomalous gold-silver-copper-lead-zinc-arsenic-antimony-bismuth in drainage and rock chip geochemical samples extending south-southwest from the historic Stronchullin Gold Mine to the abandoned Abhainn Strathainn Copper Mine.
Deep overburden geochemical sampling has delineated four new anomalous zones of quartz-gold-silver vein mineralisation at the Stronchullin and Gossan Burn Prospects, which will be drill tested in Q221.
Conroy Gold and Natural Resources PLC (LON:CGNR) is advancing the Clay Lake Gold Project, located in County Down, Northern Ireland. Conroy has recently reinterpreted the geology of the Clay Lake Project using the new geophysical data that has improved its understanding of the subsurface geology and gold mineralisation in the area. The company now believes it has identified parallel structures at the project increasing the potential for additional gold mineralisation.
Exploration at the project already generated significant results from drilling (6.6 metres at 6.2 g/t Au) and trenching (12 metres at 2.2 g/t Au) and Conroy is now planning a follow-up drill programme for 2021.
Anglo American PLC (LON:AAL) is currently developing the 2.69 billion tonnes Woodsmith Polyhalite Project, located in North Yorkshire. It is targeting the completion of a technical review of the project in mid-2021; once in production, the mine is expected to operate for the next 100 years.
Today, mining forms a minor component of the UK’s gross domestic product, c. 0.71% in 2020, but this is changing as can be seen by the wealth of exploration and development companies operating in the UK. When Anglo American’s Woodsmith Polyhalite Project comes on stream, it is expected to create nearly 2,000 direct and indirect jobs, as well as generating around £200 million per annum in taxes for the government. Smaller projects such as Scotgold Resources’ Cononish Mine are also doing their bit, with around 60 jobs created.
With the current unemployment rate rising to 5.1% (Oct-Dec 2020) - its highest level in five tears - as a result of the COVID-19 pandemic and Brexit, mining’s potential importance to our economy is increasing. Can the UK afford to be delaying projects such as Dalradian Gold’s Curraghinalt Gold Project, which could generate 1,000 direct and indirect jobs, as well as generating significant levels of taxes that will boot the UK economy, at a time when we have rising unemployment and spiralling national debt?
The delays at projects like Curraghinalt can also have a knock-on effect, putting investors and other exploration companies off investing in mining and exploration projects within the UK. With a resurgence in UK based metal and mineral exploration, now is the time for local and the national government to step-up support and being nurturing the resurgence of the UK’s mining industry with more initiatives like the £4 million in funding granted to Cornish Lithium from the UK Government’s ‘Getting Building Fund’.