Marengo inks land deal

Business, Normal

The National, Wednesday 22nd August, 2012

MARENGO Mining has entered into an agreement with woodchip operations company Jant Ltd to acquire control of 18ha of land, together with a shiploader and wharf facility, adjacent to the Madang Port.
Gaining access to this land would facilitate the proposed development of centralised infrastructure to service the company’s Yandera copper-molybdenum-gold project.
The Madang site will host the concentrate storage and shipping facilities, power station and associated transformers, office and warehouse facilities, and staff accommodation.
To acquire the land, Marengo will pay K22 million in stages up to 18 months from the date of the agreement.
The company has already made the first payment of K500,000 on signing the agreement.
Marengo is well funded following the completion of a share placement earlier this year that raised C$20 million.
The company held cash reserves of around A$24.5 million at the end of the June quarter.
Marengo is nearing the completion of a feasibility study, with the majority of the study due to be completed next month.
Some of the critical aspects of the mining engineering in the feasibility study will extend to October.
New drilling data, in particular from the Omora zone, which has highlighted significant copper and molybdenum grades could possibly have a positive effect on the mine design and scheduling.
Initial evaluation of the Omora and Imbruminda infill drilling has confirmed targeted grade interpretations and provided scope for additional shallow and medium depth increases to resources and grades.
The Yandera project, which covers 1,730sqkm, is one of the largest undeveloped copper projects in the Asia-Pacific.
Less than 5% of the structural corridor has been drilled to date, and mineralisation remains open at depth and along strike.
The project hosts an updated resource of five billion pounds of copper, 140 million pounds of molybdenum plus gold, silver and rhenium.
First production from the project is targeted for 2016.
The development plan envisages an open cut operation with an initial 20 year mine life.
The initial focus will be on higher grade “starter” zones to maximise cash flow and rapid payback.
Ore processing will begin at a rate of 25 million tonnes per annum, with the potential to increase to 50 million tonnes per annum. – Proactive Investors