Adriatic Metals PLC has provided an update on the construction activities and drilling at its flagship Vares Silver Project in Bosnia & Herzegovina.
- Lower decline construction to the Rupice underground mine expected to commence imminently. Upper decline construction expected to start by quarter end.
- Mobilisation of underground mining equipment underway.
- Haul road construction has commenced.
- Vares processing plant civil works expected to commence in the coming weeks.
- The newly appointed drilling contractor delivering a dramatic increase in productivity.
- Rupice NW continues to show continuity of high grade mineralisation.
- Infill drilling programme targeting the conversion of inferred mineral resources on the periphery of the Rupice orebody.
- New healthcare facilities opened in Vares town.
Paul Cronin, Adriatic’s Managing Director and CEO, commented: “We are very happy with the advances made in construction activities so far, with the project progressing on time as planned. Site preparation activities at Rupice Surface Infrastructure have progressed well and with the recent mobilisation of Ciftay, the first phase of underground construction is due to start imminently. Concurrently, we have recently started site works on the haul road connecting Rupice to the Vares processing plant site.
“The strong oil price continues to impact the cost of diesel in Bosnia; however, this has not made a substantial impact overall on project costs, which is promising. Therefore, we are not experiencing any major changes in budget estimates due to cost inflation.
“We continue to be excited about the north west extension to the Rupice deposit. Although assays are pending, analysis from the core logging completed to date has significantly improved our understanding of the continuity and grade of the main Rupice deposit.”
Construction activities are advancing on time as planned. Activities are split across the following three sites:
Rupice surface infrastructure site/Rupice underground mine
Ground support installation around the lower portal to the Rupice underground mine has been completed and decline development is expected to commence in the coming weeks. Excavation of the upper portal is ongoing and ground support installation is expected to start in the coming weeks, with decline development ready to start at the end of the quarter.
The imminent start of construction of the lower decline will mark the start of the three phases of mining at Rupice. The first phase is the concurrent construction of the two declines from the upper and the lower portal, down to the two parallel production levels of the Rupice orebody. The first phase is expected to be completed during 4Q22.
Phase two of mining will start at the beginning of 1Q23, with the construction of the production levels, cross cuts, ore development drives and installation of underground infrastructure ready for production mining. Phase two will be when the majority of the underground equipment mining fleet is mobilised, as there will be the multiple simultaneous headings under development. There will be just two concurrent development headings in phase 1.
The final and third phase of mining, will be production mining in ore as well as backfilling. This is expected to commence in 2Q23. Phase three will also have additional underground mobilised, albeit in smaller incremental increase than that for phase 2.
Çiftay Insaat Taahhüt ve Ticaret A.S., the company’s appointed underground mining contractor, has started its initial mobilisation of mining equipment and workshop facilities to site. By the end of this quarter, the initial phase of mobilisation will have been completed. This includes the mobilisation of equipment for the first phase of mining, as well as the installation of temporary surface facilities (offices, warehouse and workshops). Over the next 12 months, further supplementary equipment will be mobilised, as required for the subsequent second and third phase of mining.
The installation of utilities (water, telecommunications, compressed air, ventilation fans and generators) for the underground development has started. The ventilation fans and compressors for compressed air will be delivered within the next two weeks, and the installation of the surface water distribution system is also nearing completion. A telecommunications mast providing 4G network coverage across the site has also been installed.
Diesel generators (Gen-sets) have been purchased and are currently in the process of being delivered. The Gen-sets will provide power to the Rupice underground mine during the early stages of mine development until the 35 kV buried cable grid connection is laid and electrified, which is expected to be completed in 1Q23. Thereafter, the Gen-sets will remain in place as a backup power source for underground operations. In addition, a fuel supply contract has been signed for the supply of diesel for the Gen-sets, as well as the site’s mobile equipment.
A temporary explosives magazine is in the process of being installed near the lower portal. It will be utilised until the underground development has been completed in 1Q23. At which point the explosives magazine will be relocated to a new secure location underground.
Long lead order mechanical equipment packages for the backfill plant, will be imminently awarded by subcontractor Paterson and Cooke. These items include the positive displacement pumps and batching plant. The longest lead time on these items is expected to be eight months. Backfilling of stopes will start in 3Q23.
The first section of the haul road’s construction commenced earlier this month. The 25 km haul road construction is phased into five lots of approximately 5 km each in length. Roadworks have started on Lot 1, with Lot 5 expected to commence in early June. Lot 1 is the first 5 km of road from Rupice Surface Infrastructure site towards the Vares Processing Plant site, and Lot 5 is last 5 km. Permitting for Lots 2, 3 and 4 is underway and completion of the haul road is expected in 1Q23. The haul road is being constructed by the Vares Municipality, but with funding and technical assistance from the company.
Vares processing plant site
The contract for the preparation of the foundations for the Vares processing plant has been signed and work is expected to start in the coming weeks. Following the demolition in 2021 of the buildings that were formerly on the site, a number of shallow sub-terrain cavities and channels remained. Building of the foundations will require these shallow voids to be filled and in addition some of the remaining concrete removed. The new Vares processing plant buildings will be constructed on the existing concrete infrastructure from the historical processing facilities, which saves a substantial amount of time, engineering and expense. The contract for the construction of the Vares processing plant buildings is expected to be awarded imminently.
Port and infrastructure
A site visit to the deep-water port of Ploce in Croatia took place earlier in May ahead of a planned engineering survey in June. The result of the survey will confirm the most practical areas within the port as well as a report on the available infrastructure in place and any upgrades that may be required.
The company has modified its concentrate handling and shipping strategy as a result of advancing offtake discussions. The zinc concentrate will now be shipped in bulk, rather than in lined containers. The silver-lead concentrate will continue to be shipped in containers. Both concentrates, as outlined in the definitive feasibility study will be exported from the port of Ploce.
As announced on 20 April 2022, the company signed heads of terms for the offtake of the Vares Projects’ concentrates with Glencore, Trafigura, Boliden and Transamine (collectively, the offtakers). The company is advancing the execution of the full contracts with each of the Offtakers, which is expected to be completed by quarter end.
Drilling performance has improved since the appointment of Drillex, the new drilling contractor, as announced on 28 February 2022. Compared to the prior performance, there has been a marked improvement in productivity. Advancement rates have dramatically increased with 4450 m already completed within the past 7.5 weeks.
Of the three rigs that Drillex have mobilised to the Vares Project site, two rigs are currently deployed for resource definition drilling within the central part of the Rupice deposit, and one rig is stepping out along the northwest extension of the Rupice deposit.
Read the article online at: https://www.globalminingreview.com/exploration-development/30052022/adriatic-metals-provides-vares-project-update/