Barrick Lumwana is a massive open-pit mine, about 100 km from Solwezi. The mineral deposit is very large, but relatively low-grade – the ore contains just 0.58% copper.
Because of this, Barrick Lumwana has to dig up a lot more material than higher-grade mines to produce the same amount of copper. That’s a lot more drilling, blasting, transporting and crushing ore, and then processing it to produce the copper concentrate sold to regional smelters.
The mine digs up some 75 million tonnes of material every year, making it amongst the world’s highest-tonnage open-pit copper mines. When the waste rock is removed, that leaves about 23 million tonnes of ore, at an average grade of 0.58%. Technical Services Manager Perry Hamel says the geology and mineralogy is quite complex, and it is unusual to use such high tonnage rates in such a complex geological environment.
Moving the material involves a lot of specialized machinery, vehicles and support equipment, and a highly motivated workforce. There are six 550-tonne shovels and a fleet of 30 massive trucks, each capable of carrying a load of 234 tonnes. The roar of their engines is the dominant sound in the open pits, as they haul rock all day from the bottom of the pits to the crusher on the surface.
Hamel estimates it would cost half a billion dollars to renew that machinery at current prices. Indeed, a key long-term strategic objective is to accumulate sufficient cashflow to do just that, which would allow Barrick Lumwana to mine beyond 2027, once the current fleet is no longer serviceable.
That’s tough in the current low-price environment, though Hamel suggests the market will improve – eventually. “In this business, you have to be able to ride out the low points in the price cycles so you can take advantage of the high points,” he says.
Investment time horizons are very long at Barrick Lumwana. At the current low copper price, the mine’s economic evaluations predict that the life of the mine will run until 2027, which is also how long the current fleet of equipment is predicted to last. Barrick Lumwana is striving to manage its costs, so that when the copper price starts to rise again, it will be able to invest in a brand-new fleet, which would extend the life of the mine by another 15 years to 2045.
“You have to be able to ride out the low points in the price cycles so you can take advantage of the high points”
Despite the tough times, the long-term picture is not all doom and gloom. Mine General Manager, Sam Ash, says there is a lot of upside for Zambia’s mining industry, but it depends on a number of factors improving.
“We need a higher copper price to allow more revenue, a stable policy regime to give investors certainty, a lower mining-tax regime to encourage greater investment, and reliable and affordable power to allow the mines to run at maximum capacity,” says Ash. “The copper price is out of Zambia’s control, but the others are not. If these factors all line up together, there’s a great future for the country.”