New Century Resources exercises option over historic Mt Lyell copper mine
Mt Lyell has existing resources of 1.1Mt of copper and 940,000oz gold.
Tailings and mine rehabilitation specialist New Century Resources (ASX: NCZ) has, under a new option deal, two years to study the acquisition of the mothballed Mt Lyell copper mine in Tasmania.
Located near Queenstown on the island state’s west coast, Mt Lyell was first mined in 1893 by the Mount Lyell Mining and Railway Company, but closed in 2014 after the death of three workers in two separate mining accidents.
Over its lifetime, Mt Lyell has ranked as one of the most significant copper mines in Australian history.
New Century says the mine has a 135 million tonne mineral resource containing 1.1Mt of copper and 940,000oz of gold.
New Century’s flagship operation is the Century project in Queensland, the largest tailings reprocessing operation in Australia.
Vision: to be global leader in rehabilitation and tailings
Century produces 130,000t per annum of zinc concentrate, with the company having restarted operations there in 2018 focusing on the re-processing of tailing and rehabilitation of existing disturbed areas.
Mt Lyell is currently owned by Mumbai-based Vedanta, a resources giant that produces iron ore, gold, aluminium, zinc-lead, and oil and gas.
Under the option agreement, New Century is to spend US$10 million ($14 million) over the two-year period as well as reimbursing care and maintenance costs.
In October, when the company announced it was negotiating the option, managing director Patrick Walta said the New Century team had a clear focus on its vision to become a global leader in economic rehabilitation and tailings management.
‘Green’ copper plan
The company plans to use Mt Lyell as a “major” sustainable copper producer, with strong ESG credentials, and a “100% green copper” output.
Those green credentials include that 50% of the power needed will be supplied by the Lake Margaret hydro station and the fact that copper is a key metal for the green electrification of the world.
During the two-year option period, New Century will investigate the refurbishment or replacement of the existing structure at Mt Lyell for tailings processing.
Since taking over the mine in 1999, Vedanta produced just under 400,000tof copper, 1.8Moz of silver and 220,000oz of gold.
The site includes storage containing about 42Mt of historic tailings.
Recent development work has highlighted the potential for the recovery of remnant copper, gold and cobalt.