Outokumpu Copper Project

Outokumpu is situated within Finland’s premier mining district some 400 kilometres north-east of Helsinki. The area has 100 years of mining history with three major base metal mines in the area producing from 1914 to 1989.  The commencement of operations by Altona at Outokumpu represents the re-birth of mining in this famous mining camp.

The Company’s 100% owned Outokumpu Project commenced production in early 2012.  The project comprises the 600,000 tonnes per annum Kylylahti underground decline mine and the refurbished Luikonlahti mill.  The annual production rate averages 9,000 tonnes of copper, 9,000 ounces of gold and 1,600 tonnes of zinc.  Regional resources are located in 2 closed mines and 4 unmined resources within 30 kilometres of the Luikonlahti mill.  Finland is a Eurozone country and has a long history of mining, an attractive corporate tax regime (20%) and no royalties.

Kylylahti Mine

Access to the Kylylahti mine is via a 5.5 metre by 5.5 metre decline tunnel named the Vesanto Decline after Jarmo Vesanto who was the Manager of our operations in Finland until January 2014.  Mining is via long hole open stoping with voids filled by a mixture of waste rock and cemented waste rock.  Ore is transported to surface by modified road trucks to a ROM pad where road trucks transport the ore to the Luikonlahti mill for processing.

Decline development, ore and waste mucking and haulage is undertaken by contractors whereas mining ore drives and level development is undertaken by Altona.  As at March 2014 the decline is 583 metres below surface, and the main decline tunnel is now some 4.5 kilometres long.  During the year some 4,500 metres of lateral and decline development were completed.

Major infrastructure at the mine has been completed.

The mine decline is expected to reach its currently planned final depth of 800 metres in 2015.  A programme of deep drilling to extend resources, and consequently reserves and mine life has commenced.  The target is to extend resources to a depth of at least 1.1 kilometres below surface.

For detailed resource estimates click here.

Luikonlahti Processing Plant

The Luikonlahti plant was constructed in 1968 to process ore from the adjacent Luikonlahti copper-cobalt-nickel-zinc deposit which was virtually identical in grade and metallurgical characteristics to the Kylylahti deposit. The mill was comprehensively refurbished during the second half of 2011 with commissioning commencing in January 2012 and design throughput and recoveries being routinely achieved by 30 June 2012.

The plant is configured as a primary rod mill and two secondary pebble mills which is designed to provide a throughput of 550,000 tonnes per annum. Valuable metals occur in sulphide minerals which are easily recovered by flotation into two products; a copper-gold concentrate and a zinc concentrate. Concentrates are transported by truck to Boliden’s Harjavalta copper smelter and Kokkola zinc smelter approximately 400 kilometres by road.  The simple logistics chain is a key advantage of the operation.

The mill also produces a low grade cobalt-nickel-copper concentrate for storage in a lined storage dam pending sale or further processing.  There is also opportunity for co-disposal of lower grade product with cemented mine waste.

Expansion and growth

There are five complimentary and interlinked opportunities to increase returns, production rate and the life of Outokumpu:

  • Expansion of the Kylylahti resources/reserves.
  • Increases in mine production rate.
  • Expansion of the Luikonlahti mill.
  • Development of a second mine.
  • Processing or sale of low grade cobalt-nickel concentrates.

Work on these options is continuous.  A second mine and cobalt-nickel processing are longer term projects.

Other Deposits: Hautalampi

The Hautalampi Project tenements cover the historic Keretti mine near the town of Outokumpu.

The deposit is 1 kilometre long, 100-150 metres wide and up to 30 metres thick.  The bulk of the deposit is 70 and 120 metres below surface and there is potential to significantly increase the size of the Resource.

The best drill intercept is 30.4 metres at 0.62% nickel. The deposit represents the deformed low-grade halo to the main Keretti deposit which produced 28 million tonnes at 3.4% copper, 0.9% zinc from 1913 to 1989.

Whilst the deposit is low grade, it is close to the Luikonlahti Mill and produces excellent concentrates of:

  • A copper-gold concentrate grading 25% copper, 10 g/t gold
  • A nickel-cobalt concentratae grading 8.0% nickel, 2.3% cobalt

Blending of Hautalampi ore feed with Kylylahti ore feed may improve the expected revenues of Kylylahti nickel-cobalt concentrates.

A feasibility study was completed by a prior owner on mining at Hautalampi concluded that:

  • Pre-production capital costs would be approximately €6.5 million (A$10.5 million)
  • Mobile equipment for mining approximately €5 million (A$8.1 million)
  • Operating costs around €21.40/tonne (A$34.5/tonne)