Copper miner Discovery Metals on Wednesday announced that it would mothball its Boseto open pit operation, in Botswana, within the next six months.
The miner told shareholders that a review of the open pit operation had been launched earlier this year to determine the effect of the current and continuing soft market outlook for copper, as well as the prevailing high stripping ratio and the restricted geometric nature of the Boseto openpits. The review determined that the prevailing high strip ratio would result in a high operating cost environment, which was not sufficiently cash flow positive in light of the prevailing copper price.“The review concluded that the current outlook for copper pricing on world commodity markets is expected to remain soft in the short- to medium-term, and hence the recovery in the profitability of the Boseto openpit operation is unlikely in the near future,” the company said in a statement.
Discovery would now move to maximise the extraction of ore from the current operating pits, while no new open pit operations would be started. The company would also maximise all available revenue from the current open pit operations and minimise waste stripping and movement.Furthermore, Discovery would also immediately implement cost management and reduction strategies in order to reduce the operating costs at the Boseto projects.The Boseto project was expected to cease mining operations by the middle of 2015. In September this year, Discovery placed the development of the Zeta underground mine, at the Boseto mine, on hold, after failing to raise the necessary funding for the project.