Retrenchments hit Haib project
…as Deep-South licence renewal is rejected again
By Hilary Mare
AFTER pleading with the government of Namibia, through Namibia Mines and Energy Minister Tom Alweendo, to get its exploration and prospecting licence (EPL) renewed, TSX-V-listed explorer and developer Deep-South Resources has terminated all work on site and has proceeded with the retrenchment of its site-based employees
Confidente understands that the mines ministry refused to renew the licence again recently after the initial application was turned down.
Deep-South’s management met with Alweendo on June 25 and received communication from the Ministry of Mines and Energy confirming that its application for the renewal of its exclusive prospecting licence 3140 had been rejected.
The Ministry of Mines has denied its EPL renewal citing Deep-South’s inability to advance the EPL to prefeasibility study (PFS) stage and to complete the proposed drilling programme as planned.
However, in a statement, Deep-South points out that it kept the ministry well apprised, with no objection on its part, of a proposed change from the PFS to an upgraded preliminary economic assessment, as well as the start of a full feasibility study.
Further, Deep-South says the Ministry of Mines and Energy issued all permits required for the drilling programme and is “well aware” that the company has completed the programme.
Deep-South says it intends to “vigorously contest” the ministry’s decision “by all means necessary and available” under the Minerals (Prospecting and Mining) Act and other applicable laws of Namibia.
In its application for renewal and subsequent representations made to the Ministry of Mines and Energy, Deep-South maintains that it “clearly demonstrated” having met all criteria under the Act to justify the renewal of its licence.
Confidente reported last week that Deep-South had said that it has demonstrated to Alweendo that, during the past two tenures (from April 2017 to April this year), it invested N$23 million with the completion of, besides other elements, a National Instrument 43 101 resource estimation, a PEA, a large 2t sampling and bio heap-leach test, geological mapping, modelling and an upgraded PEA.
In addition, in its renewal application, Deep-South proposed a feasibility study programme with a budget of N$80 million.
The programme was under way with three drill rigs and 42 employees on site.
METS Engineering and Commonwealth Scientific and Industrial Research Organisation of Australia have also started metallurgical tests, bio-leaching, high-pressure grinding roller tests and a flow sheet enhancement programme in two laboratories in Australia.
Knight Piesold also has four scoping studies under way, covering water use, alternative power solutions, leach pad assessment, and environmental path to the environmental- and social-impact assessment.
Deep-South also informed the Ministry of Mines and Energy that, upon completion of the feasibility study, it is planning to build a pilot plant on site at an estimated cost of N$286 million.