Base Resources - Quarterly Activities Report March 2018

Base Resources - Quarterly Activities Report March 2018

Base Resources (ASX:BSE) has released a quarterly corporate, development and operational update for its Kwale mineral sands operations in Kenya. Corporately, completion of the acquisition of the Toliara sands project and associated capital raising has allowed project development activities to now commence. Operationally, the focus has been on finalising the Kwale Phase 2 mine optimisation project with commissioning of the expanded wet concentrator plant underway and progressing to plan.


HIGHLIGHTS

  • Strengthening of prices in all products.
  • Record zircon sales at 9.9kt.
  • Successful commissioning of Kwale Phase 2 optimisation project.
  • Commencement of the next phase of exploration drilling at Kwale Operations.
  • No lost time injuries.
  • Completion of the acquisition of the world-class Toliara Sands Project in Madagascar.
  • A$97 million capital raise completed, providing the funding for the initial US$75 million purchase consideration for the Toliara Sands Project.
  • Net debt further reduced by US$4.8 million to US$60.8 million, limited by peak KP2 spend, the Toliara Sands Project acquisition and sales receipt timing.

African mineral sands producer, Base Resources Limited (ASX & AIM: BSE) (Base Resources or the Company) is pleased to provide a quarterly corporate, development and operational update for its Kwale Mineral Sands Operations (Kwale Operations) in Kenya. Corporately, completion of the transformational acquisition of the Toliara Sands Project and associated capital raising has allowed project development activities to now commence. Operationally, the focus has been on finalising the Kwale Phase 2 mine optimisation project with commissioning of the expanded wet concentrator plant underway and progressing to plan. On the marketing front, pricing for ilmenite, rutile and zircon have all strengthened during the quarter.

At the start of March, a month-long mining and wet concentrator plant (WCP) shutdown was initiated on schedule to complete final equipment installation and piping tie-ins for the Kwale Phase 2 (KP2) mine optimisation project (see below for further detail). As a consequence, mined tonnage for the quarter was significantly lower at 1.9 million tonnes (Mt) (from 2.9Mt last quarter). Mined ore grade fell to 6.9% Heavy Mineral (HM) (7.6% HM last quarter) as mining proceeds around the north-western fringes of the Central Dune orebody.

Due to the KP2 shutdown and reflecting the ongoing transition to hydraulic mining as the sole mining method, the hydraulic mining unit (HMU) tonnes mined reduced marginally from the prior quarter’s 1.2Mt to 1.1Mt and dozer mining unit (DMU) tonnes mined declined from 1.7Mt to 0.8Mt for the quarter.

[1] Zircon low grade tonnes contained in concentrate, equivalent to approximately 70-80% of the value of primary zircon.

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