Wrap Text
2025 Definitive Feasibility Study for Prieska Copper Zinc Mine Delivers Robust Financial & Technical Outcomes
Orion Minerals Limited
Incorporated in the Commonwealth of Australia
Australian Company Number 098 939 274
ASX share code: ORN
JSE share code: ORN
ISIN: AU000000ORN1
2025 Definitive Feasibility Study for Prieska Copper Zinc Mine Delivers Robust Financial & Technical
Outcomes from De-Risked Two-Phase Development Strategy
DFS outlines a rapid pathway to production and cash flow via initial shallow underground mining, paving the way for
longer-term development of the large-scale "Deeps" Resource
HIGHLIGHTS
- 2025 Definitive Feasibility Study (DFS-25) for Orion's flagship project, the Prieska Copper Zinc Mine (PCZM),
located in the Northern Cape Province of South Africa, delivers robust financial and technical results.
- The DFS-25 outlines an optimised two-phase development strategy aimed at de-risking the development
pathway and fast-tracking value-creation from a safe, modern, long-life, mechanised, underground base
metal mine:
o Initial "Upper-Level Phase" – based on mining near-surface supergene sulphide ore which is accessible
from an existing decline, with first production expected 13 months after start of construction and
continuing for 4.3 years. Capital expenditure to achieve first concentrate production is AUD49 million
(ZAR560 million).
o The "Deeps Phase" – to commence following completion of mine de-watering, refurbishment of the
main shaft and construction of the mining infrastructure. Mining of the Deeps has a life of mine (LoM)
(life of mine from first production) of 11 years and will overlap with the last 2.2 years of the Upper-Level
mining. This gives a combined LoM of 13.2 years.
- Key financial outcomes include:
o Net Present Value (NPV) (at an 8% discount rate) of:
o Pre-tax: AUD797 million (ZAR9,966 million),
o Post-tax: AUD568 million (ZAR7,105 million);
o Internal Rate of Return (IRR) of 31% pre-tax (26% post-tax);
o Payback period from start of construction of 5.8 years;
o Undiscounted life-of-mine free cash flows of AUD1,782 million (ZAR22,277 million) (pre-tax);
o Peak funding requirement of AUD578 million (ZAR7,230 million);
o Total project capital expenditure (including contingency) of AUD607 million (ZAR7,592 million);
o Capital intensity of USD9,174/t annual copper equivalent production, to achieve nameplate annual
copper production of 22ktpa and zinc production of 65ktpa;
o All-in-sustaining costs of USD4,550/t (USD2.06/lb) of copper equivalent metal sold;
o All-in-sustaining cost net of by-product credits of USD2,359/t (USD1.08/lb) of payable copper sold;
o All-in-sustaining margin of 52%, based on average received copper price of USD9,480/t (USD4.30/lb);
and
o Ore processing rate of 240ktpa for the Upper-Level Phase and 2.4Mtpa for the Deeps Phase.
- Installed infrastructure improves overall capex and time to production – The combination of historical
infrastructure and recently installed facilities (during trial mining) enable the project to advance more rapidly
to first production and reduces the overall capital expenditure.
- Historical data supports DFS - Extensive historical mining, production and geological data has helped inform a
number of the assumptions in the DFS.
- Mineral Resources at PCZM total 31.0Mt at an average grade of 1.2% copper and 3.6% zinc, resulting in 370kt
of contained copper and 1,120kt of contained zinc.
o Indicated Mineral Resources of 20.0Mt @ 1.22% copper and 3.47% zinc for 240kt of contained copper
and 690kt of contained zinc; and
o Inferred Mineral Resources of 11Mt @ 1.2% copper and 3.9% zinc for 130kt of contained copper and
420kt of contained zinc.
- Probable Ore Reserves at PCZM total 15.6Mt at an average grade of 1.1% copper and 3.1% zinc, resulting in
164kt of contained copper and 458kt of contained zinc.
- Externally reviewed
o The DFS has been externally reviewed by independent technical expert, Practara Metals and Mining
Advisory (Practara).
The effective date of the DFS is 31 December 2024. The indicative timelines that have been provided in the
report are for illustrative purposes and assumes that the project is fully funded at the report effective date.
- Next steps are to advance:
o Project financing;
o Project implementation planning;
o Concentrate offtake negotiations; and
o Agreements with service providers for key early works activities and long lead it
Disclosure on Forward Looking Statements
Certain information set forth in this Feasibility Study Report contains "forward looking information", including "future
oriented financial information" and "financial outlook", under applicable securities laws (collectively referred to
herein as forward looking statements). Information contained herein constitutes forward looking statements.
Forward looking statements are provided to allow potential investors the opportunity to understand
management's beliefs and opinions in respect of the future so that they may use such beliefs and opinions as one
factor in evaluating an investment. These statements are not guarantees of future performance and undue
reliance should not be placed on them. Such forward looking statements necessarily involve known and unknown
risks and uncertainties, which may cause actual performance and financial results in future periods to differ
materially from any projections of future performance or result expressed or implied by such forward looking
statements.
Although forward looking statements contained in this Feasibility Study Report are based upon what management
of the Company believes are reasonable assumptions, there can be no assurance that forward looking statements
will prove to be accurate, as actual results and future events could differ materially from those anticipated in such
statements. The Company undertakes no obligation to update forward looking statements if circumstances or
management's estimates or opinions should change except as required by applicable securities laws. The reader
is cautioned not to place undue reliance on forward looking statements.
The Definitive Feasibility Study (DFS) reported in this Announcement determines the commercial viability of
establishing mining and ore processing operations on the Prieska Copper Zinc Mine (PCZM). The DFS has been
prepared with the objective that its findings are subject to an accuracy range of ±15%. The findings in the Study,
including the estimates of rates of return, costs, payback, NPV, milling rates, and production rates, should be
viewed with this in mind and are subject to all necessary permits, regulatory requirements, financing, Board
approval and further works as described throughout.
This Feasibility Study contains Production Targets and Forecast Financial information supported by a combination
of approximately 65% Probable Ore Reserves, Indicated Mineral Resources and approximately 35% Inferred
Mineral Resources, all classified and disclosed in compliance with ASX Listing Rules and JORC Code (2012)
reporting standards. Orion is satisfied that the portions of Inferred Mineral Resources included in the Production
Targets (never more than 35% of the mining plan) are not the determining factor in project viability and do not
feature as a significant portion early in the mining plan.
Note that there is a low level of geological confidence associated with Inferred Mineral Resources and there is no
certainty that further exploration work will result in the determination of Indicated Mineral Resources or that the
portion of the production target reliant on Inferred Mineral Resources will be realised.
The Ore Reserves and Mineral Resources underpinning the Production Target have been prepared by Competent
Persons in accordance with the requirements in Appendix 5A JORC Code (2012) in accordance with the ASX
Listing Rules.
All material assumptions for the DFS are outlined in this report. These include assumptions about the availability of
funding. While Orion considers all of the material assumptions to be based on reasonable grounds, there is no
certainty that they will prove to be correct or that the range of outcomes indicated by the DFS will be achieved.
Peak funding in the order of ZAR7,230 million (AUD578 million) (which incorporates an 11% contingency allowance)
will be required.
Orion's Managing Director and CEO, Errol Smart, commented:
"The 2025 Definitive Feasibility Study for our flagship Prieska Copper Zinc Mine marks the culmination of a major
strategic and technical re-think of the development strategy for this large-scale base metal mine undertaken over
the past few years. The outstanding results outlined in the DFS-25 confirm the potential to develop a long-life,
financially robust mining operation via a two-phase development plan which substantially de-risks the mine
development pathway and fast-tracks initial cash flow.
"One of the biggest changes from the previous study we completed in 2020 has been the decision to undertake
an initial phase of mining focused on the supergene sulphide ore in the upper levels of the orebody. This approach
will enable us to deliver first production from the Upper-Level Phase within 13 months of the start of construction,
with the cash generated during these early years helping to fund the ongoing de-watering and other early works
required for the second-phase mining of the Deeps.
"The early mining of the Upper-Level will require additional capital for a dedicated, bespoke processing plant to
handle the supergene sulphide ore and additional mining fleet with smaller units suited to the particular mining
conditions in the Upper-Level. However, the additional capital brings the benefit of early production and derisking
of the entire project by intensive training of an owners mining team who will be specifically trained and have a
high productivity culture embedded prior to the start of Deeps Mining three years later and at ten times the scale.
"We are particularly pleased that even with the increased capital of two processing plants and with two
mechanised mining fleets, the overall capital intensity to reach full nameplate production is below USD9,200 per
annual copper equivalent tonne.
"Once we have steady-state production underway at the Deeps, we expect to mill 2.4mtpa and produce 22kt of
copper and 65kt of zinc on an annual basis. With an all-in sustaining cost of around USD2/lb of copper equivalent
metal sold. We believe PCZM will generate healthy cash flows throughout the copper price cycle."
"In addition to strong financial metrics, the DFS includes a range of Environmental, Social and Governance factors,
including commitments to strive for class-leading performance relating to safety, local employment and
procurement, tailings management, water stewardship and community engagement.
"Beyond the currently defined life of mine, we see additional upside by converting more Mineral Resources into
Ore Reserves, as well as by defining additional mineralisation at depth, where drilling and downhole
electromagnetics have indicated that the mineralisation persists beyond the limit of the Mineral Resource, both of
which could provide additional mine life and potential for increased scale at PCZM.
"This positive study for PCZM, together with the study for the Flat Mines Project at our Okiep Copper Project that
will be released shortly, puts Orion firmly on-track to become a near-term base metals producer, with total copper
production of around 30ktpa once both projects are at steady state. This would enable Orion to make an
important contribution to the economic development of the Northern Cape Province of South Africa.
"With these studies now complete, our focus turns to finalising our project financing strategy, which we expect will
comprise a combination of debt, equity and offtake related funding.
"I would like to sincerely thank the team, led by our General Manager at PCZM, Andre Bergh, and DFS Project
Director, Nick Fouche, for the hard work that has gone into delivering this favourable DFS. I would also like to
acknowledge the ongoing support of our project partners and shareholders."
Industrial Development Corporation (IDC) Divisional Executive Industry Planning and Project Development, Rian
Coetzee, commented:
"Orion's Prieska Project presents a unique value proposition with significant upside potential, perfectly aligning with
the IDC's Critical Minerals Plan. By leveraging existing infrastructure, the project is set to commence mining
operations ahead of the previous BFS schedule, accelerating value creation and delivering economic benefits.
We remain committed to supporting this project and unlocking its full growth potential."
Orion Minerals Limited (ASX/JSE: ORN) (Orion or the Company) is pleased to present the outcomes of the Definitive
Feasibility Study for the Prieska Copper Zinc Mine, located in the Northern Cape Province of South Africa.
The DFS has delivered robust financial and technical results and outlines an optimised two-phase development
strategy aimed at de-risking the development pathway and fast-tracking value-creation from a long-life, modern
underground base metal mine, with outstanding exploration potential for growth and LoM extension.
EXECUTIVE SUMMARY
The Prieska Copper Zinc Mine (PCZM) is located in the Northern Cape Province of South Africa. The Mine was
previously known as the Prieska Copper Mine which ceased operations in 1991. The DFS as summarised in this
Executive Summary, was carried out to a cost estimation accuracy level of ± 15% and is supported by a Mineral
Resource estimate reported in accordance with the JORC Code (2012) in December 20181 and an updated
Mineral Resource released to the ASX/JSE on 28 March 2025. The DFS outlines an improvement of the business case
detailed in a previous Feasibility Study released in 2020 for the establishment of new underground mining
operations at the existing site. Two distinct sections will be mined, known as the Upper Levels, and the Deeps.
The planned operation starts with the Upper-Level Phase which runs for 4.3 years based on mining Supergene and
Oxide ore close to surface which will be accessed from an existing decline. During the Upper-Level mining,
pumping in the main shaft will take place to de-water the mine which is currently flooded to 265 metres below
surface. Following the de-watering, refurbishment of the main shaft and construction of the mining infrastructure
will take place. The Deeps underground mining will begin from the 28th month of project and production overlaps
with the last 2.2 years of the Upper-Level mining. The combined operation is planned over 13.2 years of production
at an ore processing rate of 240ktpa for the Upper levels and 2.4Mtpa for the Deeps. Inferred Resources are
included in each of the two mining plans in what are called Life-of-Mine plans. An Ore Reserves only mining plan
has also been prepared for both Upper and Deeps sections in-line with the JORC Code (2012) recommendations
and guidelines in order to confirm the financial viability of mining without product yield from Inferred Resources.
Detailed drilling plans have been compiled to facilitate the upgrading of the Inferred Mineral Resources areas of
the plans to Indicated Mineral Resources following access to the relevant underground areas. Orion has achieved
a very high upgrade of Inferred Resources to Indicated Resources with infill drilling at PCZM.
1 Refer ASX/JSE Release 18 December 2018.
Ore from the Upper levels and Deeps mining will feed separate froth-flotation processing plants to produce a
copper concentrate with important gold and silver byproduct credits from the Upper Levels and separate copper
and zinc concentrates from the Deeps. Small amounts of gold and silver are recovered in the Deeps copper
concentrate as by-product credits. The concentrates will be sold to an international metals trader and exported
for toll smelting and refining which is costed as CIF-FO to China (cost, insurance & freight – free out, meaning that
PCZM is responsible for the cost to the destination port and the trader pays for the unloading).
The report complies with Australian Securities Exchange (ASX) listing rules and The Australasian Code for Reporting
of Exploration Results, Mineral Resources and Ore Reserves, 2012 (JORC Code) reporting standards.
Financials
The post-tax Net Present Value (NPV) of the combined operation is ZAR7.1 billion (AUD568 million), using non-
inflation-adjusted estimates and a discount rate of 8%, and achieves a post-tax Internal Rate of Return (IRR) of
26%. The NPV is based on long-term forecast weighted average metal prices of USD9,401/tonne for copper and
USD2,665/tonne for zinc2 and a ZAR-USD foreign currency exchange rate of 18:90:1. The Project has an
undiscounted post-tax LoM cash flow of ZAR16.6 billion (AUD1.3 billion).
The total estimated capital cost for PCZM is ZAR7,592 million (AUD607 million). Peak funding requirements amount
to ZAR7,230 million (AUD578 million) including an 11% contingency allowance. Payback is planned to occur 5.8
years from the start of construction and only 2.4 years after peak funding.
For the combined operation, all-in-sustaining unit costs (AISC) over the duration of the LoM will be approximately
USD4,550/t or USD2.06/lb (AUD6,880/t) copper equivalent (CuEq3) metal sold. The operating break-even grade is
estimated at 0.99% CuEq. This operating break-even grade is well below the average combined Uppers and
Deeps Ore Reserve (see Table 15) grade of 1.6% CuEq3, applied in the production schedule. 63% of the revenue
is from copper and 37% from zinc.
Sensitivity analysis indicates that post-tax NPV for the combined operation is most sensitive to ZAR-USD exchange
rate with a range of ZAR3.9 billion to ZAR10.7 billion as the exchange rate varies from +15% to -15% from the base
rate of ZAR:USD 18.90:1 As the copper price is varied from -15% to +15% of the base assumption of USD9,401/tonne
post-tax NPV ranges from ZAR3.5.1 billion to ZAR9.1 billion. As the zinc price is varied from -15% to +15% on the base
assumption of USD2,665/tonne, post-tax NPV ranges from ZAR5.7 billion to ZAR8.6 billion.
Key assumptions and Project performance parameters of the DFS-25 are presented in Table 1 below.
2 Metal price assumptions based on consensus long-term forecasts (December 2024).
3 Method used to determine Cu_Equivalent (CuEq) grades is consistent with the formula determined and applied
in BFS-20 refer ASX/JSE release 26 May 2020, taking into account current market conditions and NSR currently
offered by reputable trading entities.
1% Zn = (Zn price x Zn NSR) x (Zn plant recovery) = (2,450 x 69.7%) x (82.1%) = 0.185% Cu
(Cu price x Cu NSR) x (Cu plant recovery) (8,900 x 101.3%) (85.8%)
Cu_Equivalent grade = Cu grade + (0.185 x Zn grade).
Table 1: Key DFS Results (real terms) for the Prieska Copper Zinc Mine. Note that the DFS estimation accuracy level is ± 15%.
Executive Dashboard - Combined LoM Plan
Production and Financial Summary
Weighted Average Price and FX Assumptions Unit Value Financial Performance Unit Value Unit Value
Metal price - Cu USD/t 9 401 Net Present V alue (Pre Tax) @ 8% Discount Rate ZAR millions 9 966 AUD millions 797
Metal price - Zn USD/t 2 665 Net Present V alue (Post Tax) @ 8% Discount Rate ZAR millions 7 105 AUD millions 568
Metal price - Au USD/oz 2 160 IRR (pre-tax) % 31% % 31%
Metal price - Ag USD/oz 27 IRR (post-tax) % 26% % 26%
Exchange rate ZAR:USD 18,90 Payback period (from start of concentrate production) years 4,8 years 4,8
Exchange rate ZAR:AUD 12,50 Undiscounted free cash flow (pre-tax) ZAR millions 22 277 AUD millions 1 782
Exchange rate AUD:USD 1,51 Undiscounted free cash flow (Post-tax) ZAR millions 16 559 AUD millions 1 325
Production metrics Unit Value Peak funding ZAR millions 7 230 AUD millions 578
Life of Mine Years 13,17 Capital Intensity (LOM Nameplate Capacity) USD/Cueq(tpa) 9 174 AUD/Cueq(tpa) 13 871
Treatment plant capacity ktpa 2 400 Project Cost Metrics Unit Value Unit Value
Average cash operating unit cost (C1) ZAR/t 1 176 AUD/t 94
ROM Plant Feed Grade - Cu % 1,07% All-in-sustaining cost per unit ROM t ZAR/t 1 389 AUD/t 111
ROM Plant Feed Grade - Zn % 3,21% All-in-sustaining cost per unit Cu eq tonne sold USD/t Cu 4 550 AUD/t Cu 6 880
Overall Plant Recovery - Cu % 85,19% All-in-sustaining cost per unit Cu eq lb sold USD/lb Cu 2,06 AUD/lb Cu 3,12
Overall Plant Recovery - Zn % 83,0% All-in-sustaining cost per unit Zn eq tonne sold USD/t Zn 1 292 AUD/t Zn 1 954
Concentrate tonnage - Cu kt 1 066 152 All-in-sustaining cost per unit Zn eq lb sold USD/lb Zn 0,59 AUD/lb Zn 0,89
Concentrate tonnage - Zn kt 1 229 197 All-in-sustaining margin % 52% % 52%
Concentrate grade - Cu % 19,9% Operating breakeven grade (Cu eq) % 1,00% % 1,00%
Concentrate grade - Zn % 49,7% Project Cashflows Unit Value Unit Value
NSR as % of metal price - Cu % 102,3% LoM net revenue ZAR millions 58 296 AUD millions 4 664
NSR as % of metal price - Zn % 76,5% LoM operating costs (includes Government Royalty) ZAR millions 27 215 AUD millions 2 177
Metal produced (in concentrate) - Cu tonnes 213 055 Project Start-up Capital Expenditure ZAR millions 6 170 AUD millions 494
Metal produced (in concentrate) - Zn tonnes 610 630 Sustaining Capital Expenditure ZAR millions 1 211 AUD millions 97
Metal sold as copper equivalent tonnes 376 922 Income Tax ZAR millions 5 718 AUD millions 457
Metal sold as zinc equivalnet tonnes 1 329 593 Cash Flow After Tax ZAR millions 16 559 AUD millions 1 325
Level of Accuracy of Financial Model ± 15%, LoM = Life of Mine, NSR = Net Smelter Return, NPV = Net Present Value, IRR = Internal Rate of Return
There is a low level of geological confidence associated with Inferred Mineral Resources and therefore there is no certainty that further exploration work will result in the determination of Indicated
Mineral Resources or that the Production Target or financial forecast information referred to in this Study will be realised.
The cash flow profile of the combined operation is shown below. Capital expenditure takes place over four years
followed by 11 years of positive cash flow. Concentrate production from the Upper Levels will start in year two of
the project with the Deeps starting in year four.
Figure 1: Estimated cash flow of 2025 DFS.
The NPV sensitivity according to changes in the main financial and technical inputs is shown in the graph below.
Figure 2: Sensitivity of the post-tax NPV to changes in key project parameters for the DFS-25.
A more detailed sensitivity of the post-tax NPV (ZAR millions) to changes in copper and zinc price is illustrated in
the following tables.
Figure 3: The effect of fluctuations in metal prices and foreign currency exchange rates on the post-tax NPV and IRR for the DFS-25.
A flat corporate tax rate of 27%, the current applicable tax rate in South Africa has been applied for the duration
of the Project. Capex is redeemed 100% against taxable income in the year that it was spent from the first year
and unredeemed capital expenditure due to capex exceeding taxable income is carried forward into successive
years for calculations of the tax deductions.
The Government Royalty calculation is based on the production of unrefined metals where the revenue allows for
Net Smelter Return (NSR) deductions but excludes an allowance for concentrate transport logistics costs. Over the
LoM, the Royalty ranges from 0.5% (the minimum) to a maximum of 7.0% of net revenue, with the average royalty
being 3.8%.
The PCZM Mining Right and the Vardocube Mining Right, are permitted for 24 and 12 years, respectively
(renewable for periods of up to 30 years) allowing for possible extensions beyond the currently planned 13.2-year
life. Beyond the planned LoM it is anticipated that mine-life extensions are possible from delineated Mineral
Resources that are not yet incorporated into the mining plan as well as known deposit extensions and existing
pillars which are anticipated to require low capital investment to extend the mine life. Significant potential for
nearby satellite deposits has been identified.
COMPARISON OF DFS-25 TO BFS-20
Compared to the 2020 study, material technical and schedule changes made in the 2025 study are:
• Increasing the mine dewatering timeline from 10 months to 22 months and replacing water treatment with
100% forced evaporation for the disposal of underground water;
• Linked to the above, the schedule for shaft refurbishment increases to 25 months from 21 months;
• Mining the Upper Levels +105 Mineral Resource via underground methods early in the LoM as opposed to
an open-pit method which was at the end of the Deeps section;
• Additional mining fleet was added to the capex for the Uppers mining section as previously the open-pit
mining plan assumed a contractor owned fleet;
• The Upper Levels processing, will be operated via a BOOT (build, operate, own, transfer) as opposed to
PCZM crews previously planned for the open-pit mining plant;
• The underground construction period has been increased from 8 months to 13 months;
• An interim rock handling system will be installed to allow for an earlier start to the Deeps mining;
• A more conservative ramp-up to full Deeps production of 27 months compared to 20 months in the 2020
study;
• First concentrate is produced in month 13 of the Project compared to month 33 in the 2020 study due to
the Upper Levels starting early in the Project's life;
• The 2020 study planned for a specialist processing contracting company to operate the Deeps plant which
will now be operated by PCZM crews;
• Rehabilitation of the decline from surface to the Deeps section has been increased from 25% of the decline
length to 100% (7.1 km); and
• Areas of operational infrastructure being financed by third party financing has been replaced by
traditional capital funding.
The key Project business case valuation numbers and economic assumptions used in the two studies are
compared in Table 2 below.
Table 2: Comparison of key business assumptions between DFS-25 and BFS-20.
The comparative capital estimate numbers comparing the 2025 and 2020 studies are shown in Table 3 below.
Overall, there is a 49% increase including contingency.
Table 3: Comparative capital estimate between DFS-25 and BFS-20.
Capital DFS-25 BFS-20 Variance
ZAR million ZAR million Value %Variance
Accommodation camp 142 93 49 52%
Bulk Power Supply 377 58 319 550%
Bulk Water 30 27 3 11%
Cuprum 132kV Feeder Bay Upgrade (15MVA) 1 4 -3 -85%
Construction Power Cost 0 113 -113 n/a
Decline Rehab 406 0 406 n/a
Effluent Dam 0 82 -82 n/a
EPCM 280 276 4 2%
Evaporation Capital 43 34 9 27%
Evaporation Operational cost 0 25 -25 n/a
Install and commission Rock & Man winder 436 176 260 148%
Mining Fleet 1 015 552 462 84%
Owners Team 191 119 72 60%
Backfill/Paste plant 544 180 363 202%
Process Plant 1 833 1 002 830 83%
Project services 23 109 -86 -79%
Dewatering 133 217 -85 -39%
Shaft refurbishment 88 234 -146 -62%
Surface infrastructure 286 388 -102 -26%
Surface Ventilation 92 64 28 44%
Tailings Storage Facility 186 438 -252 -57%
UG mining construction 435 296 139 47%
Ventilation Raise bore holes 59 0 59 n/a
Laboratory 34 0 34 n/a
Exploration costs 130 0 130 n/a
Operational Readiness 15 0 15 n/a
Drilling Related Cost 2 0 2 n/a
RO Plant 0 115 -115 n/a
Irrigation system 0 28 -28 n/a
Contingency 814 463 351 76%
Total 7 592 5 093 2 499 49%
In addition to escalation over the five years since the 2020 study, the technical and scope changes that have
affected the capital estimates are described below.
• Mining fleet – additional units added for the Uppers mining not included in the previous study as the open-
pit mining used a contractor owned fleet;
• A separate process plant was added for the Upper section mining which was not in the 2020 study;
• Paste-fill plant – a second stream was added. Underground piping and pumping have been re-allocated
to this area that was previously costed in the shaft area. A tailings loading section has been added.
Separate engineering, procurement and construction management (EPCM) & P&Gs costs also added
there were not allowed for previously (the Paste plant has its own EPCM contractor);
• Bulk power supply – Construction power costs have been reallocated to this activity increased scope;
• Surface infrastructure costs have decreased as a number of facilities have already been built during the
Trial Mining stage (which is explained later in the release);
• Owner's Team costs have increased due to the construction schedule increasing by 10 months;
• A new rock winder was included compared to a refurbished winder in the previous study;
• The TSF has been partially built during the Trial Mining phase and a new design has reduced costs;
• De-watering and shaft refurbishment costs have decreased as temporary winders have been removed
and replaced with a smaller winch system and the use of the man winder earlier. This work is now being
carried out by the Owner's Team;
• Project services have decreased as portions of this cost have been re-allocated to other areas of the
estimate; and
• The following items were removed from the 2025 scope: effluent dam, RO water treatment plant and the
irrigation system (part of the de-watering).
The LoM plan operating costs for the two studies are compared below. Escalation from 2020 to 2024 is the main
driver of higher costs for the DFS-25 with opex increasing from ZAR971/tonne to ZAR1,353/tonne, a 39% increase.
Table 4: Operating costs estimate between DFS-25 and BFS-20.
Operating Costs DFS-25 BFS-20 Variance
ZAR/RoM t ZAR/RoM t ZAR/RoM t %
Mining 644 413 231 56%
Processing 246 163 83 51%
Surface & Indirects 112 62 50 81%
Concentrate Transport Charges 173 116 57 49%
Corporate Costs 17 13 4 30%
Off-mine Costs 27 17 10 59%
Royalties (Government) 81 74 7 10%
SIB Capex 52 60 -8 -13%
Operationalised Infrastructure 0 54 -54 -100%
Total 1 353 971 381 39%
The AISC per tonne of copper equivalent metal for the 2020 study was USD3,531/tonne (USD1.60/lb) which has
increased to USD4,550/tonne (USD2.06/lb). The increase is driven by higher operating costs.
DETAILS OF THE DEFINITIVE FEASIBILITY STUDY
Project Location
The Project is located in the Northern Cape Province of South Africa. The following diagram outlines the location
of the Company's exploration activities, with the PCZM site located at the southern extent, approximately 60km
south-west of the town of Prieska. The Project site is at an elevation of 1,070m above mean sea level. The PCZM
area is predominantly flat, undulating and sand covered, and the natural vegetation of the area is dominated by
low shrubs and Silky Bushman Grass. The mean annual precipitation for the PCZM area is approximately 176mm
per year, with 62% of this falling between January and April. The average maximum daily temperatures range from
32°C in January to 17°C in June with an average minimum daily temperature of 1°C in July.
Figure 4: Project Location.
Project Ownership and Licencing
Orion Minerals Ltd (Orion) completed the acquisition of Agama Exploration and Mining (Pty) Ltd (Agama) in March
2017 which had a prospecting right over the historical Prieska Copper Mines Ltd (PCML) assets. Orion's ownership
of the asset has progressed and now incorporates Black Economic Empowerment (BEE) ownership via three
entities which together have a 30% shareholding of PCZM. A Community Trust and an Employee Trust hold 5%
equity interest respectively with a BEE entrepreneurial entity, Prieska Resources (Pty) Ltd, holding 20%. Orion at the
Holding Company level controls the remaining 70%. The entities holding the two Mining Rights are Prieska Copper
Zinc Mine (Pty) Ltd (formerly Repli Trading No. 27 (Pty) Ltd) and Vardocube (Pty) Ltd. An organogram of the
ownership structure is shown below:
Figure 5: Project Corporate Structure.
The BEE ownership in PCZM (and, indirectly in its subsidiary, Vardocube), meets the current ownership guidelines
of the South African Mining Charter 2018 which requires that new mining rights must include ownership by entities
that have a minimum of 30% Historically Disadvantaged South Africans shareholding. The Charter recommends
this 30% ownership be distributed as follows:
• 5% non-transferable carried interest to employees;
• 5% non-transferable carried interest to host communities; and
• 20% ownership by BEE entrepreneurs, with a preference for women.
The Industrial Development Corporation (IDC) advanced a R250 million loan to the project in order to undertake
the trial mining during 2024. The IDC has a right to convert this loan into a ~15.8% stake in the project. The IDC will
have 90 days from the date that Orion provides notice of the positive outcome of the DFS to exercise its conversion
option. A summary of the material terms of the IDC Convertible Loan definitive agreement is provided in Appendix
1 of the 8 February 2023 ASX/JSE release.
Aquila Sky Trading 890 (Pty) Ltd (formerly Prieska Copper Mines Ltd), is a wholly owned subsidiary that retained
rights (surface, servitudes and other) within the PCZM Mining Right area. Key surface rights agreements to provide
access to land on the PCZM site are in place. The PCZM area consists of two mineral tenements, the PCZM Mining
Right and the contiguous Vardocube Mining Right (see below). Together, these tenements cover a combined
6,766 hectares in area. It is planned that the two mining rights and the linked obligations will be amalgamated
under the PCZM Mining Right.
Table 5: Mining Rights held by PCZM.
Area
Mining Right Right Holder Registered Description Mineral List Status Validity
(Ha)
Portions RE25 and 26 of Cu, Zn, Pb, Ag, Au, S, Co, Granted Expiring
Repli Trading No. Vogelstruis Bult 104 and Ba, Limestone, Stone 4 December 2019 3 December
PCZM 27 (Pty) Ltd now the farm Slimes Dam 723 aggregate, Gravel, 2043
NC10138MR known as PCZM 154, Prieska District, Sulphur in Pyrite, Pyrite, Executed Renewable for
Northern Cape Province Mo, W, Sand (gen), Fe-ore 11 December 2019 periods up to
30 years
Portion RE1 of Cu-ore, Zn-ore, Pb, Au, Granted 14 August Expiring 13
Vardocube Vardocube (Pty) Vogelstruis Bult 104, Ag, Co, S, Sulphur in 2020 August 2032
NC10146MR Ltd Prieska District, Northern 6,043 pyrite, Ba, Limestone, Renewable for
Cape Province Pyrite, W, Mo, Fe-ore Executed periods up to
20 October 2020 30 years
Surrounding the PCZM area, Orion also holds additional granted prospecting rights under subsidiary entities. These
tenement holdings enable exploration for down-dip and westerly extensions of the Prieska Deposit to be
undertaken as well as the search for possible cluster deposits in the vicinity. A map showing the boundaries of the
mineral tenements granted to various Orion subsidiaries, in the vicinity of the planned mining area, is shown below:
Figure 6: Granted mineral tenements to Orion entities.
Satellite deposit potential has been demonstrated by Orion with intersections of sulphide mineralisation at Ayoba,
5km from the mine site. Further afield, available historical data and exploration work by Orion has confirmed the
existence of numerous follow-up massive sulphide Cu-Zn-rich targets within Orion's tenements4.
Project History
The mine was previously owned and operated by Prieska Copper Mine Limited, a subsidiary of Anglo-Transvaal
Consolidated Investment Company Limited (Anglovaal).
Anglovaal successfully operated the mine as a semi-mechanised underground operation between 1971 until 1991.
During that time the mine processed 46Mt of run-of-mine (RoM) material and produced 430Kt of Cu and 1.01Mt
of Zn5, at average processing plant metal recoveries of 84.9% for Cu and 84.3% for Zn. Reported grades at the time
of mine commissioning were 1.7% Cu and 3.8% Zn with gold and silver byproduct in concentrate 6. Pyrite was also
intermittently produced as a by-product. The concentrates were either smelted domestically at O'kiep and Zincor
or exported via Saldanha Bay.
The decision to close the mine was influenced by a combination of the uncertain economic and political
environment in South Africa in the late1980s and the technical considerations that arose as the mine got deeper
and the spatial orientation of the mineralisation changed. The technical considerations relating to the mining of
the flattened deposit no longer presents a major challenge as modern mechanised mining methods, employed
globally, present a solution to the historical challenges.
Existing Infrastructure
Despite the Project site being in a remote part of South Africa, with no nearby large human settlements, it is well-
serviced by infrastructure that was established for the previous mining operation. Existing infrastructure includes a
water pipeline from the Orange River at the town of Prieska, tarred roads, national grid power supply (which will
be upgraded for the planned operation) and a 1.7km-long air strip. The village of Copperton, which is located
4km by road from the main rock hoisting shaft was the principal residence for the mine community. The town is still
in use, though only 40 of the original 300 houses remain. The farming service town of Prieska, with a population of
16,0007, lies 60km north-east of the Project site. The operating rail siding of Groveput, located 50km from the Project
site, on-route to the town of Prieska, can potentially provide rail access to the main Kimberley – De Aar railway line
and from there to various ports. This siding is currently not operating on a regular basis however talks are planned
to be held with Transnet (the South Africa government rail authority) about a future rail option for the concentrate
transport.
The main hoisting shaft, which is 1,024m deep, 8.8m in diameter and concrete-lined, with a concrete headgear,
remains intact although refurbishment is required to bring the shaft back into operation. The mine is currently filled
with water to a depth of 265m below surface. During a Trail Mining phase which was carried out during 2023 to
early 2024, various surface facilities were built, including offices, a change house, electrical and water reticulation
and a dewatering dam. These facilities will be expanded for use in the Deeps mining phase.
Mineral Resources and Exploration
The Prieska Copper- Zinc Deposit (Prieska Deposit) is a volcanogenic massive sulphide (VMS) style deposit, with
mineralisation proved along 2.4km of a northwest-southeast trending strike extent and down to a depth of 1.25km.
Mineralisation of Cu, Zn, silver (Ag) and gold (Au) is contained in massive sulphides distributed as a persistent lens
within gneiss rock assemblages contained within an overturned synform. The diagram below shows the general
structure of the deposit in relation to the main Hutchings shaft and the Beecroft ventilation shaft.
4 Refer to ASX/JSE Releases 16 January 2019 for Ayoba satellite exploration target and 25 February 2019 for Prieska deposit extensional potential.
5 Refer ASX/JSE Release 15 November 2017
7 Based on census numbers escalated as reported in the Baseline Health Status Report, Infotox, January 2020.
Figure 7: Structure of the deposit.
By the time the mine closed, the deposit had been exploited to a depth of 900m below surface. Strike and dip
extensions had been identified, mineral resource estimates prepared, and access development partially
established into parts of the deposit extensions. Orion used the extensive catalogue of historical drill hole and
geological data to guide its verification and infill drilling campaigns on both the supergene sulphide +105 Level
("Uppers") Deposit and the hypogene Deep Sulphide ("Deeps") Deposit.
In addition to 23 historical holes, Orion drilled 79 diamond drill holes and reverse circulation holes into the
supergene sulphide deposit including geotechnical and metallurgical test-work holes. 42 of these holes were in
the mineralised zone. In the Deeps deposit, 41 diamond drill holes plus 61 deflections were drilled including
geotechnical and metallurgical test-work holes. The core logging, sampling procedures and QA/QC were carried
out according to Orion's PCZM Standard Operating Procedures by qualified geologists. Further QA/QC on sample
assays was carried out by an independent company, BS Geo Consulting Services (South African). The Orion
samples were all prepared and analysed by ALS Chemex (Pty) Ltd in Johannesburg South Africa.
These programs culminated in the declaration of Mineral Resources estimated by Z Star Mineral Resource
Consultants (Pty) Ltd (South African) and classified in accordance with the JORC Code (2012), as presented in the
three tables that follow, for the Uppers, Deeps and Combined (Table 6, Table 7 and Table 8, respectively). These
Mineral Resources, excluding the Uppers Oxide Zone Mineral Resource, form the basis for the DFS-25 and the Ore
Reserves reported herein.
Table 6: Declared Mineral Resources, reported in accordance with the JORC Code (2012) – individual areas & combined.
+105 Updated Mineral Resource for the PCZM Tenement
(Effective Date: 28 March 2025)8
Classification Mineralised Zone Tonnes Contained Cu Cu Contained Zn Zn
(metal tonnes) (%) (metal tonnes) (%)
Oxide 700,000 5,000 0.73 5,000 0.77
Supergene Sulphide +
Indicated 800,000 23,000 2.84 21,000 2.67
Hypogene
Total 1,500,000 28,000 1.86 27,000 1.79
Oxide 300,000 3,000 1.0 2,000 0.8
Supergene Sulphide +
Inferred 300,000 8,000 2.6 3,000 0.9
Hypogene
Total 600,000 10,000 1.8 5,000 0.9
Total +105 Mineral Resource 2,100,000 38,000 1.8 32,000 1.5
+105m Level Oxide Mineral Resource mineralisation interpretation wireframe cut-off = 0.3% Cu Mineral Resources stated
at 0.3 % Cu cut-off.
+105m Level Supergene Sulphide + Hypogene Mineral Resource mineralisation interpretation wireframe cut-off = 0.8%
Cu. Mineral Resources stated at 0.7% Cu cut-off.
Numbers may not add up due to rounding in accordance with the JORC Code (2012).
The Mineral Resources are inclusive of Ore Reserves
Deep Sulphide Mineral Resource for PCZM + Vardocube Tenements
(Effective Date: 15 December 2018)9
Tenement Classification Tonnes Cu Cu Zn Zn
(metal tonnes) (%) (metal tonnes) (%)
Indicated 19,000,000 220,000 1.17 670,000 3.60
Deep
Sulphide Total Inferred 10,00,000 120,000 1.1 420,000 4.1
Total 29,000,000 330,000 1.2 1,080,000 3.8
Deep Sulphide Resource mineralisation interpretation wireframe cut-off = 3% Equivalent Zn (Zn Eq = Zn% + (Cu%x2)).
Mineral Resources stated at zero % cut-off.
Numbers may not add up due to rounding in accordance with the JORC Code (2012)
The Mineral Resources are inclusive of Ore Reserves.
8 Mineral Resource reported in ASX/JSE Release of 28 March 2025 available to the public on http://www.orionminerals.com.au/investors/asx-jse-announcements/.
Competent Person: Orion's Mineral Resource: Mr. Sean Duggan. Orion confirms it is not aware of any new information or data that materially affects the information
included in the original market announcement. The Company confirms that all material assumptions and technical parameters underpinning the Mineral Resource
estimates in the ASX/JSE Release of 28 March 2025 continue to apply and have not materially changed. Orion confirms that the form and context in which the
Competent Person's findings are presented here have not been materially modified from the original market announcement.
9 Mineral Resource reported in ASX/JSE Release of 18 December 2018: "Landmark Resource Upgrade Sets Strong Foundation" available to the public on
http://www.orionminerals.com.au/investors/asx-jse-announcements/. Competent Person: Orion's Mineral Resource: Mr. Sean Duggan. Orion confirms it is not
aware of any new information or data that materially affects the information included in the original market announcement. The Company confirms that all
material assumptions and technical parameters underpinning the Mineral Resource estimates in the ASX/JSE Release of 18 December 2018 continue to apply and
have not materially changed. Orion confirms that the form and context in which the Competent Person's findings are presented here have not been materially
modified from the original market announcement.
Combined Mineral Resource for PCZM + Vardocube Tenements
(Effective Date: 28 March 2025)8
Mineral Resource Classification Tonnes Contained Cu Cu Contained Zn Zn
(metal tonnes) (%) (metal tonnes) (%)
Deep Sulphide Resource Indicated 19,000,000 220,000 1.17 +670,000 3.60
Inferred 10,000,000 120,000 1.1 420,000 4.1
Indicated 1,500,000 28,000 1.86 27,000 1.7
+ 105m Level Resource
Inferred 600,000 10,000 1.8 5,000 0.9
Indicated 20,000,000 240,000 1.22 690,000 3.47
Total
Inferred 11,000,000 130,000 1.2 420,000 3.9
Grand Total 31,000,000 370,000 1.2 1,120,000 3.6
Deep Sulphide Resource mineralisation interpretation wireframe cut-off = 3% Equivalent Zn (Zn Eq = Zn% + (Cu%x2)).
Mineral Resources stated at zero % cut-off.
+105m Level Mineral Oxide Resource mineralisation interpretation wireframe cut-off = 0.3% Cu. Mineral Resources
stated at 0.3 % cut-off.
+105m Level Mineral Supergene Sulphide + Hypogene Resource mineralisation interpretation envelope (wireframe)
cut-off = 0.8% Cu. Mineral Resources stated at 0.7 % Cu cut-off.
Numbers may not add up due to rounding in accordance with the JORC Code (2012).
The Mineral Resources are inclusive of Ore Reserves.
Mineral Resource Classification Criteria and Confidence for the Deep Sulphide (underpinning the Deep Sulphide
Ore Reserve)
Refer to ASX release 18 December 2018.
Mineral Resource Classification Criteria and Confidence for the +105 Level Supergene Sulphide and Hypogene
Zone (underpinning the +105 Ore Reserve)
Refer to ASX release 28 March 2025.
There are areas of potential mineralisation upside to the PCZM Resource. There are possible strike extensions in the
N-W and S-E sections of the Deeps orebody, and pillars areas (should they be intact) in the historical workings
above the Deeps Resource. These areas are currently unquantified and there are no estimates that are consistent
with the term 'Exploration Target' as defined by JORC Code (2012).
Mining Method, Assumptions, Plans & Ore Reserves
The Upper Levels
Orion has delineated a Supergene Mineral Resource located at the lower part of the crown pillar of the historical
mine, above Level 105, which, based on this study, is estimated to contain approximately 1 million tonnes of
mineable Cu and Zn ore. A decline from surface and tunnel development remaining from the historical mining
allows for early access to this area and therefore mining can begin relatively quickly. Mineral Resource modelling
delineated a weak meta-argillite schist zone approximately 10m wide in the footwall side of the deposit. In addition
to this, difficulties with underground core drilling during the resource definition phase in the meta-argillite zone
suggested that challenging mining conditions may be expected.
The targeted Upper Levels mining areas are near surface, located close to sinkholes that formed early in the mine's
history. Previously mined stopes are present on the down-dip side, requiring the design of a sill pillar to separate
historic workings from planned mining operations. Natural weathering extends to approximately 90m below
surface, reducing rock mass quality. Based on the knowledge of the meta-argillite zone and the expected
generally weaker rock conditions and since access was available to this upper-level area, a trial mining exercise
was set up to test the ability of mining teams to safely develop through the rock conditions. This is explained below.
Trial Mining
A development mining team made up of a contractor's crew was assembled and managed by PCZM staff.
Mining took place over seven months. The team also tested mining efficiency in these conditions and prepared
for future longer-term mining operation in the upper levels. The trial mining was also aimed at confirming geological
contacts, distribution of mineralisation across the mineralised units and to confirm forecast Cu and Zn grades.
Once underway, the team was able to intersect the meta-argillite zone safely without any incidents. Mining also
took place in massive supergene sulphides and in a transition zone between the hypogene and supergene
sulphides with intermingling of both types of material. With the correct support patterns, the crews were able to
mine through all the various zones without major setbacks. The trial mining also measured the performance of the
crews in terms of advance rates per month. Over the seven months the crew peaked at 141 metres in a month
and including in excess of 60 metres per development end per month. A relatively high amount of machine down-
time hindered better performance which will be rectified when new equipment is purchased for the Upper Levels
mining.
Overall, as reported in ASX release 28 March 2025, the trial mining exercise improved the resource definition
regarding the ore-waste contacts and provided more information on the transition zones and general rock
conditions. It was proven that difficult mining areas could be negotiated safely with the appropriate rock support.
These results improved the mine planning that was carried out for the Upper Levels area.
Upper Levels LoM Plan
Development mining will start in month two of the construction schedule followed by production mining in month
four. Once the processing plant is commissioned, copper concentrate will be produced from month 13.
Production mining will build up to steady state production of 20,000 tonnes per month over 15 months and mine
731,000 tonnes over a five-year period. Zinc in the Upper levels will be recovered within the bulk copper
concentrate but will not be at payable levels. A break-even grade of 1.87% Cu is calculated with detailed mine
planning.
The ore-body thickness ranges from 3.5 metres to 20 metres and where the thickness is greater than 12 metres, two
adjacent stopes will be planned. Mechanised Long-hole Open Stoping with cemented aggregate back-fill will be
used throughout the Uppers sections. Level spacing will be 12 metres. Back-fill strengths have been designed at
140-200 kPa depending on the area with an accelerated curing time of 7 days. Geological losses were included
in the Resource model. The modifying factors used in the stoping design are shown below.
Table 7: Modifying Factors - Dilution.
Factor Units LHOS
Planned dilution – area dependent % 17% – 25%
Mining extraction – area dependent % 85% – 90%
Figure 8: A 3-D view of the Upper-Level mining area is shown below indicating the proximity to the exiting sinkholes.
The development and production fleet will be sourced from Epiroc and Siton (Chinese) with the secondary fleet
sourced from Fermel, a South African company. 7 tonne LHDs will be used for loading and 30 tonne trucks will
transport the waste and ore to surface. Maintenance on the mining fleet will be carried out at a surface workshop.
All mining activities will be carried out by PCZM crews on 2 x 10 hr shifts, over 23 days a month with two blasting
times per day. The PCZM crews will be supported by Australian mining specialists who will provide focussed
operational and maintenance training to achieve world class mining performance. The Upper Levels mining crews
will ultimately provide part of the initial Deeps mining complement to drive high levels of efficiency during the
ramp-up and into steady state production.
Grade control geologists will be present on all shifts to maximise ore recovery and minimise waste dilution.
Maximum waste development advance rates of 238m per crew per month have been planned with 176m per
month in ore drives. Development waste will be crushed on surface for use in the cemented back-fill and shotcrete
which will be delivered underground via three boreholes from surface for distribution by LHDs into the mining areas.
The weathered mineralisation has an unconfined compressive strength (UCS) of 3 MPa, whereas fresh ore reaches
111 MPa. The host rock is less affected by weathering, remaining fresh and competent around the ore zone. The
UCS values for the footwall gneiss and hanging wall amphibolite are 198 MPa and 307 MPa, respectively. To
mitigate risks associated with weaker rock zones, long-term access and service excavations are positioned within
fresh host rock, approximately 20m to 30m from the ore body. Five tunnel support types have been designed
based on the rock zones and the depth of mining, starting with split-set bolts and including welded mesh, shotcrete
and cable anchors in the weathered and phlogopite zones. In addition, all tunnel intersections will be reinforced
with 4.5 metres cable anchors. The five support types with the corresponding rock zones are shown below.
Figure 9: Five support types and corresponding rock zones.
Fresh air for the Upper-Levels will be supplied by the existing decline from surface and two existing shafts, the main
Hutchings shaft and the Beecroft shaft, plus two smaller vent shafts, the Marias, and Boehmke shafts. Return air
will be via the existing B500 shaft which will be equipped with four 75kW fans and a new raise-bored upcast shaft
also with four 75kW fans.
The Upper Levels LoM plan contains 731,000 tonnes of ore with an average mined grade of 2.3% Cu with 16,400
tonnes of contained copper.
Table 8: Upper Levels LoM key numbers.
PCZM Upper Levels LoM Estimate (Effective Date: 31 December 2024)
Upper Level Plan -
Tonnes (kt) Cu% Cu Tonnes (kt)
Resource Class
Indicated 629 2,3 14,5
Inferred 102 1,8 1,8
TOTAL 731 2,3 16,4
There is a low level of geological confidence associated with Inferred Mineral Resources and therefore
there is no certainty that further exploration work will result in the determination of Indicated Mineral
Resources or that the Production Target or financial forecast information referred to in this Study will
be realised.
Indicated Resources make up 86% of the Upper Level LoM plan while Inferred Mineral Resources make up the
remaining 14%. Having considered geological continuity and the nature of the deposit's mineralisation, Orion is
optimistic that the Inferred Mineral Resources included in the mining plan have good prospects of being upgraded
to Indicated Mineral Resources and that the mining plan is realistic and achievable. In support of this, sufficient in-
fill drilling is planned to upgrade the Inferred Resource to Indicated Resources ahead of mining.
The Upper Levels LoM mining profile is shown in the chart below.
There will be a 273 strong labour force on site at the Upper Levels steady state operation.
Over the last 26 months of the Upper Levels operation, the Deeps mining section will begin production and start
ramping up to steady state levels.
Upper Levels Reserves Only Plan
An alternative mine plan ('Reserves only plan'), based solely on Indicated Mineral Resources, was prepared for
the Uppers Levels and used to support the estimation and reporting of an updated Probable Ore Reserve for the
Uppers Level of 629 kt grading 2.3% Cu for 14.5 Kt of contained Cu (refer Table 9).
Table 9: Ore Reserve Estimate – Uppers Level
PCZM Upper Levels Reserve Estimate (Effective Date: 31 December 2024)
Uppers Reserve Class Tonnes (kt) Cu% Cu Tonnes (kt)
Probable 629 2,3 14,5
Proven - - -
TOTAL 629 2,3 14,5
Project Ore Reserves estimated using financial assumptions and modifying factors stated in the FS-25.
Tonnes are rounded, which may result in rounding errors. The corresponding Indicated Mineral
Resources, disclosed are inclusive of these Ore Reserves.
The Reserves only plan is economically viable with a standalone NPV of ZAR36 million and an IRR of 11.6% and
confirms that the Inferred Mineral Resources included in the LoM plan are not the determining factor in project
viability. The Reserves only plan maintains a 20,000tpm steady state ore production. The Upper Levels mining profile
of the Reserves only plan is shown below.
The capex estimate for the Reserves only plan remains the same as for the LoM plan.
Upper Level Breakeven Grade
The breakeven grade is based on several mineable shape optimiser (MSO) scenarios using Cu cut-off grades
between 0.5% and 1.9%, while maintaining a 20kt per month production schedule. The MSO results were analysed
considering a practical mining approach and critical mass for the project of approximately 730kt over LoM. A cut-
off grade of 0.7% Cu gave the most effective balance between value and mineable volume.
Upper Level Modifying Factors - Ore Reserve
The Uppers Ore Reserve estimate was updated as part of this Study using updated modifying factors and
economic assumptions summarised below and in Table 7.
Upper Level Mining Methods
The selected mining method for the Upper Levels is LHOS with CAF. The selection is based on orebody geometry
and geotechnical characteristics, with smaller strike lengths and reduced spans in weaker sections to mitigate
potential instability. Detailed planning accounts for backfill strengths, with Uniaxial Compressive Strength (UCS)
ranging from 100kPa to 200kPa, ensuring adequate ground support and stability.
Economic Viability of the Upper Level Ore Reserve
Economic viability of ore reserve only mining is positive with a NPV of ZAR36 million.
Upper Level Infrastructure and Logistics
Existing infrastructure from Trial Mining has established foundational readiness (power upgrades, dewatering
systems, and surface facilities), significantly reducing the implementation risk. Upper Levels concentrate logistics
are optimized for economic transport and sale, reducing exposure to variability in shipping logistics and charges.
Upper Level Risks and Uncertainties
Identified risks mainly involve potential geological variability, cost escalation, and technical execution. Risks
associated with ground conditions and stability have been addressed through Trial Mining and detailed
geotechnical analysis and mine design.
Continued exploration drilling is planned to upgrade remaining Inferred Mineral Resources and further reduce
geological risk.
Upper Level Statement on Global vs Local Estimates
The Ore Reserve and Mineral Resource statements predominantly apply at a global project scale, although local
estimates for specific mining areas (e.g., Trial Mining) were validated through detailed, targeted assessments,
providing a strong foundation for technical and economic evaluation at a local scale.
Upper Level Comparison with Historical Production Data
Where historical data exists (notably in metallurgical recoveries and orebody delineation), results from recent
activities are consistent with historical operations, providing additional confidence in the estimation and recovery
assumptions made for current Ore Reserves.
Upper Level Conclusion
The Ore Reserve estimate for the Upper Levels (+105) at PCZM demonstrates a high level of relative accuracy and
confidence. This confidence is underpinned by robust geological and geotechnical validation through trial
mining, detailed planning and consideration of modifying factors, economically viable operational planning, and
effective integration of existing infrastructure with clear strategies for mitigating remaining risks and uncertainties.
The key outstanding uncertainty pertains to the geological upgrading of Inferred Mineral Resources, which is
already planned and budgeted for through additional infill drilling. The approach taken aligns well with best
practices and relevant industry standards, including the JORC Code (2012).
The Deeps Mining Plan
The Deeps area of the mine is currently under water to 265 metres below surface and mine dewatering, shaft
refurbishment and underground construction is required before production can start. The timeline for these
activities to be completed is expected to be 27 months from Project commencement. Development and
production mining will start in month 28 and build up over a further 27 months to a steady-state rate of 200ktpm or
2.4Mtpa.
Breakeven grades were calculated based on the different mining methods using their respective costs and
modifying factors which range from 0.99% Cu equivalent for transverse LHOS to 1.13% for Drift & Fill (D&F) which is
the highest cost mining method.
For production mining, mechanised Long-hole Open Stoping (LHOS) with Paste-Fill will be used in the steeper
sections using either Longitudinal (LLHOS) or Transverse (TLHOS) methods depending on the width of the orebody.
Level spacing in these areas will be 20 metres or 30 metres depending on local conditions. D&F will be used in the
flatter sections with panel dimensions of 5 x 5 metres or 6 x 6 metres depending on the orebody thickness. The
mining mix will be 74% from LHOS and 26% from D&F. Paste-fill strengths have been designed at 500 kPa for the
D&F sections and up to 2,000 kPa for the LHOS sections. Curing times of 28 days has been designed for both LHOS
and D&F applications.
Geological losses have already been applied to the Mineral Resource block model and have therefore not been
applied as a mining modifying factor. The applicable stoping modifying factors are shown below.
Table 10: Stoping modification factors.
Deeps Modifying Factors - Stoping
LLHOS TLHOS D&F
Factor Units
(%) (%) (%)
Hanging wall Overbreak cm 50 50 0
Footwall Overbreak cm 50 50 0
Unplanned Dilution % 3 3 3
Unplanned dilution grade % CuEq 0.0 0.0 0.0
Mining Recovery % 95 95 97
Figure 10: Deep Sulphide deposit planned mining areas.
All mining activities will be carried out by PCZM crews on 2 x 12 hr shifts, 7 days a week with two blasting times per
day. The mining fleet will consist of Epiroc machinery for development and long-hole drill rigs. 40 tonne trucks and
14 tonne LHDs will be supplied by Siton (Chinese). Fermel (South African) will supply explosive vehicles and utility
vehicles. The locos for rail transport will be supplied by Goodman (American). For development and production
taking place above 957 level, which is the main transport level, a rail system will be used to transport rock to the
shaft. Rock mined from D&F and the two LHOS South-East zones will be trucked back up to 926-Level into rock
passes feeding 957-Level.
There is an existing workshop on 957-Level which will be refurbished for regular vehicle services and two satellite
workshops will be built at the N-W and S-E sections of the mine for minor services. An existing workshop on 836-
Level will also be refurbished, for major component change-outs to lessen congestion on the 957-Level workshop.
Major engine or frame re-builds will be carried out off-site by either the Original Equipment Manufacturer or a
certified machine fabricator.
Ventilation of the Deeps is via down-cast air through the existing Hutchings shaft and the existing surface decline.
During the de-watering and shaft refurbishment phase the existing Beecroft shaft will be used as the upcast shaft.
Once the underground production levels are established, a new return ventilation shaft system will be raise-bored
to connect the 957-Level to surface in addition to the Beecroft return airway shaft. The total volume of fresh air for
the underground mining is 750m3/s and will be achieved through combining the Deeps and Upper Levels
ventilation sections.
The rock mass quality in the Deeps is generally good, with hanging-wall and footwall-wall gneiss having average
UCS values of 310 MPa with average RMR values of 88 and 79 respectively. The mineralised zone has an average
rock strength of 197 MPa and a RMR of 78. Rock support will take the form of split-sets in ore tunnels. In waste
development, resin grouted roof-bolts will be used with shotcrete to provide additional areal coverage in selected
excavations. Grouted cable anchors will be used at all permanent breakaways and intersections. To cater for
stress changes as mining progresses, footwall tunnels will be set back a minimum of 25 metres from the orebody
and declines will be 40 metres from the orebody.
The contacts between the mineralisation and the footwall and hanging-wall rocks are sharp and clearly visible in
drill core produced from the exploration phase. The mining cut-off therefore corresponds closely to the contact
of the mineralised zones and the gneiss which will allows for good grade control. Diamond drilling has been
planned ahead of all stoping operations to determine the orebody contacts and grades for stope design and
production planning.
In the first stage of mining, an interim rock handling system will be constructed that will be in use for six months
while the permanent system is being installed. The interim system will make use of temporary grizzly - rock breaker
arrangements where rock will be trucked and discharged into two existing silos and onto conveyors transporting
rock to the skip loading station at the shaft. The permanent system will involve re-fitting the existing crusher
chamber and the installation of a conveyor system to the top of the silos mentioned above. A 3-D view of the
permanent system is shown below highlighting rail tipping, crushing and the five conveyors A to F, taking rock to
the shaft loading silos. The total conveyor length is 700m.
Figure 11: A 3-D view of the permanent system.
Deeps LoM Plan
The Deeps LoM plan contains 22.6Mt of material with an underground average mined grade of 1.0% Cu and 3.3%
Zn, giving a Cu equivalent (CuEq) grade of 1.6% Cu. The CuEq (%) values presented for the Deeps LoM Plan (Table
11) and Deeps Probable Ore Reserve estimate (Table 12) were determined based on the following:
• Orion considers that both Cu and Zn have a reasonable potential to be recovered and sold.
• Assumed commodity prices of USD8,900/t Cu and USD2,450/t Zn based on analysts' consensus as at May
2024.
• Net smelter returns (NSRs) of 101.3% and 69.7% for Cu and Zn, respectively based on offtake proposals from
concentrate traders and metallurgical details as detailed in JORC Table 1.
• The following calculation formula which is consistent with BFS-20 refer ASX release 26 May 2020:
o CuEq (%) = Cu (%) + 0.185 x Zn (%)
(Zn price x Zn NSR) x (Zn plant recovery) (2,450 x 69.7%) x (82.1%)
Based on 1% Zn = = = 0.185% Cu
(Cu price x Cu NSR) x (Cu plant recovery) (8,900 x 101.3%) (85.8%)
This plan contains 233kt of Cu and 736kt of Zn over the LoM. The following table highlights the key numbers.
Table 11: PCZM life of mine estimate – Deeps Section.
PCZM Deeps LoM Estimate (Effective Date: 31 December 2024)
Cu Tonnes Zn Tonnes CuEq Metal CuEq Grade
Deeps LoM Plan - Tonnes (Mt) Cu% Zn% (kt) (kt) Tonnes(kt) (%)
Resource Class
Indicated 14,7 1,0 3,2 153 468 239 1,6
Inferred 8 1,0 3,4 81 270 131 1,7
TOTAL 22,7 1,0 3,3 234 736 371 1,6
There is a low level of geological confidence associated with Inferred Mineral Resources and therefore there is no
certainty that further exploration work will result in the determination of Indicated Mineral Resources or that the
Production Target or financial forecast information referred to in this Study will be realised. Tonnes are rounded, which may
result in total rounding errors
Indicated Resources make up 65% of the Deeps LoM plan with Inferred Mineral Resources making up the remaining
35%, this compares favourably with proportions of Indicated (67%) and Inferred Resource (33%) included in the
BFS-20 LoM Plan (refer ASX release 26 May 2020). Having considered very strong geological continuity and the
nature of the deposit's mineralisation, Orion is optimistic that the Inferred Mineral Resources included in the LoM
plan have good prospects of being upgraded to Indicated Mineral Resources and that the mining plan is realistic
and achievable. Infill drilling conducted in 2017-2018 achieved almost complete upgrade of Inferred resources to
Indicated category (refer ASX/JSE release 18 December 2018). The Trial Mining exercises provided additional
confidence in geological continuity and potential for achieving increased confidence in Inferred Resources with
infill drilling to improve sampling density (refer ASX release 28 March 2025). A detailed in-fill drill program has been
planned, consisting of 22,400 metres of drilling to upgrade the Inferred Resources to Indicated Resources with infill
drilling to achieve similar sampling density as per the Indicated Resource drill sampling density. The drilling will start
once the underground areas are opened up to provide drilling access from underground.
Waste development and production mining both start in month 28 of the PCZM LoM schedule followed by a 27-
month build-up to full production of 200,000tpm. A sufficient volume of ore needs to be available before the plant
can begin operating continuously, therefore a surface stockpile will be built to store the required volume for plant
production. By month 15 of the ore mining ramp-up, 550,000 tonnes will be on the stockpile allowing the plant to
start wet commissioning followed by a seven-month ramp-up to reach steady-state of 200,000 tonnes processed
per month, as shown in the profile below. Steady state plant production is then reached 21 months after mining
starts or 48 months (4 years) from Project start.
The Deeps LoM plan runs for 11 years as shown below. Inferred Resources do not feature as a significant proportion
early in the mine plan.
There will be a staff complement of 975 people on site for the Deeps operation.
Deeps Reserves only plan
An alternative mine plan ('Reserve only plan') was prepared as part of this study, relying solely on Indicated
Mineral Resources (except where Inferred Mineral Resources were included as dilution) and used to support the
estimation and reporting of an updated Probable Ore Reserve for the Deeps Level of 14.9Mt grading 1.0% Cu and
3.1% Zn, containing 150kt copper metal and 458kt zinc metal, (CuEq grade of 1.6% for 234kt CuEq metal). This
alternative plan will produce 200,000tpm but will have a shorter life compared to the LoM plan. The key numbers
are shown in the table below.
Table 12: Ore Reserve Estimate – Deeps Level
PCZM Deeps Reserve Estimate (Effective Date: 31 December 2024)
Cu Tonnes Zn Tonnes CuEq Metal CuEq Grade
Deeps Reserve Class Tonnes (Mt) Cu% (kt) Zn% (kt) Tonnes (kt) (%)
Probable 14,9 1,0 150 3,1 458 234 1,6
Proven 0,0 0,0 0 0,0 0 0 0,0
TOTAL 14,9 1,0 150 3,1 458 234 1,6
Project Ore Reserves estimated using financialassumptions and modifying factors stated in the FS-25. Tonnes are rounded,
which may result in rounding errors. The corresponding Indicated Mineral Resources, disclosed are inclusive of these Ore
Reserves.
The updated Ore Reserve is reported in accordance with the JORC Code (2012) and is inclusive of minor scattered
areas of approximately 0.5Mt of Inferred Mineral Resources as dilution within the fringes of practical mine stope
shapes. No grade and revenue have been assigned to these Inferred Resources within the economic models or
in the declared Probable Ore Reserve as these tonnes report to the processing plant effectively as another form
of dilution. The Inferred tonnes represent approximately 4% of the Ore Reserve.
The Reserves only plan is economically viable with a post-tax NPV of ZAR2.7 billion and an IRR of 18.2% over an 8.3-
year life. The plan confirms that the Inferred Mineral Resources included in the LoM plan are not the determining
factor in project viability. The capital estimate and operating costs for the Reserves only plan remains the same as
for the LoM plan.
The mining profile of the Deeps Reserves only mine plan is shown below.
The mining ramp-up for the Reserves only plan follows the same profile as for the LoM plan.
Deeps Section Breakeven Grade
For the Deeps, breakeven grades were calculated based on the different mining methods using their respective
costs and modifying factors which range from 0.99% CuEq for transverse LHOS to 1.13% CuEq for Drift & Fill (D&F)
which is the highest cost mining method.
Deeps Section Modifying Factors – Deep Sulphide Ore Reserve
The Deeps Ore Reserve estimate was updated as part of this Study using updated modifying factors and economic
assumptions summarised below and in Table 10 above.
Deeps Section Geological Confidence
The underlying Mineral Resource for the LoM plan consists of 64% Indicated and 36% Inferred Resources. The Ore
Reserve has been derived solely from Indicated Resources, with Inferred Resources excluded from the Ore Reserve
estimation, except where included as dilution within the fringes of practical mine stope shapes (approximately 4%
of the tonnes). The Ore Reserve model has incorporated geostatistical methods for orebody interpolation,
constrained by drill hole data spacing.
Deeps Section Geotechnical and Mining Confidence
Geotechnical assessments have determined appropriate stope dimensions and mining methods, ensuring
practical extractability. The mining method selection (LHOS and D&F) was informed by ground conditions and
benchmarking against similar operations. Planned dilution (16%) and unplanned dilution (3%) have been
incorporated into the Ore Reserve model. Mining recovery factors (95% for LHOS, 97% for D&F) have been
optimised, considering improved stope stability and controlled blasting methodologies.
Deeps Section Economic and Processing Considerations
Modifying factors such as commodity price assumptions, metallurgical recoveries, and operational costs have
been rigorously assessed. The expected overbreak of 0.5m on hanging wall and footwall was derived from
benchmarking and geotechnical analysis The impact of dilution on grade has been modelled, with unplanned
dilution applied at zero grade, ensuring conservative estimates.
Deeps Section Global vs. Local Estimates
The Ore Reserve estimate is considered a global estimate, covering the entire Deeps mining area. However, for
technical and economic evaluation, the mine plan relies on local estimates, particularly in targeted production
zones. Local estimates focus on stope-level reconciliation of grade, tonnage, and modifying factors, ensuring
alignment with operational constraints.
Deeps Section Dilution and Overbreak
Planned dilution assumptions (16%) and unplanned dilution (3%) have been benchmarked against similar LHOS
operations, improving confidence in Ore Reserve estimates. Development ends assume a 5% overbreak, but ore
drives are not assigned additional overbreak due to their containment within planned stope shapes.
Deeps Section Mining Recovery:
A conservative mining recovery of 95% for LHOS and 97% for D&F was assumed, supported by operational
experience in similar mining conditions. Stopes will be extracted until backfill dilution exceeds 50%, ensuring
minimal ore loss.
Deeps Section Dewatering and Infrastructure Risks:
The dewatering schedule remains on the critical path. Shaft rehabilitation, underground infrastructure upgrades
and ventilation improvements are key items on the critical path to be monitored.
Deeps Section Comparison with Production Data
While full-scale production from the Deeps is not yet available, Trial Mining results have validated key assumptions.
Orebody continuity has been confirmed at the expected locations. Ground conditions have been stable, allowing
for larger-than-expected excavations without excessive support. Mining rates and development performance
align with industry benchmarks, supporting the assumed modifying factors.
Deeps Section Conclusion
The Ore Reserve estimate for the Deeps carries a high degree of confidence for Indicated Resources but remains
contingent on infill drilling for Inferred material conversion. The modifying factors have been rigorously assessed,
but risks remain in dewatering schedules, dilution control, and paste fill implementation. Further reconciliation with
operational data will refine these estimates over time.
Estimation Methodologies for the Ore Reserves
FS-25 used DatamineTM and a mineable shape optimiser (MSO). Deductions were made for material excluded by
the MSO, geological and pillars losses and a mining extraction factor. Dilution is included during the MSO process.
The modifying factors, preliminary designs and schedules were done using the Mineral Resources classified and
released in December 2018 for the Hypogene Deep Sulphides (refer ASX release 18 December 2018) and in March
2025 for the +105 in the Upper Levels (refer ASX/JSE release 28 March 2025).
Material assumptions regarding timeframe for development and production assumed that the FS-25 is financially
positive, the necessary licences and permits are granted by the authorities and funding is procured.
Combined LoM Plan
The combined LoM mining profile (including the Inferred Mineral Resources) for the Upper Levels and Deeps
section is shown below.
The Upper Levels mining has higher Cu grades than the Deeps section due to the enriched Supergene ore. The
metal production profile is shown in the following table.
Table 13: Metal production profile for the combined Life of Mine.
Metal in concentrate - 000 t Totals Yr 1 Yr 2 Yr 3 Yr 4 Yr 5 Yr 6 Yr 7 Yr 8 Yr 9 Yr 10 Yr 11 Yr 12 Yr 13 Yr 14
Total copper 182,1 0,0 1,4 4,6 4,1 19,9 21,9 21,2 22,0 22,8 23,1 21,3 19,9 18,8 12,2
Total zinc 510,6 0,0 0,0 0,0 0,0 57,2 68,3 68,3 65,9 72,5 70,3 56,1 52,0 62,7 37,4
Total metal produced 692,7 0,0 1,4 4,6 4,1 77,1 90,2 89,5 87,9 95,3 93,4 77,4 71,8 81,5 49,5
Table 14: Combined Life of Mine plan - metrics.
PCZM Combined LOM Estimate Dated: 31 December 2024
CuEq Grade
Deeps LoM Plan Resource Class Tonnes (Mt) Cu% Zn% Cu Tonnes (kt) Zn Tonnes (kt) CuEq (kt)
(%)
Indicated 0,6 2,3 - 15 - 15 2,3
Uppers Inferred 0,1 1,8 - 2 - 2 1,8
Total Uppers 0,7 2,3 - 16 - 16 2,3
Indicated 14,7 1,0 3,2 153 468 239 1,6
Deeps Inferred 7,9 1,0 3,4 80 270 130 1,7
Total Deeps 22,6 1,0 3,3 233 736 369 1,6
Indicated 15,4 1,1 3,2 167 468 253 1,6
Total Inferred 8,0 1,0 3,4 82 270 132 1,6
TOTAL 23,4 1,1 3,3 249 736 385 1,6
There is a low level of geological confidence associated with Inferred Mineral Resources and therefore there is no certainty that further
exploration work will result in the determination of Indicated Mineral Resources or that the Production Target or financial forecast information
referred to in this Study will be realised.
There will be a period of 26 months where both the Uppers and Deeps sections will be concurrently operating. As
the Upper Levels section winds down, mining and engineering labour will transition to the Deeps to supplement its
new employees and to bring practical experience to the Deeps section.
Combined Reserve plan
The combined Uppers and Deeps Levels Ore Reserves estimate is presented in the table below. A combined CuEq
grade and CuEq metal is presented; however, the CuEq value presented for the Uppers deposit is equal to the
Cu contribution as the zinc currently does not have reasonable potential to be recovered and sold from the Upper
Levels. Orion confirms that all elements included in the metal equivalent calculations (Cu and Zn for Deeps and
Cu only for Uppers) have a reasonable potential to be recovered and sold.
Table 15 Combined Uppers and Deeps Ore Reserve estimates, reported in accordance with the JORC Code (2012).
PCZM Combined Reserve Estimate Dated: 31 December 2024
Combined Reserves Tonnes (Mt) Cu% Zn% Cu Tonnes (kt) Zn Tonnes (kt) CuEq Tonnes CuEq Grade
Class (kt) (%)
Probable Uppers 0,6 2,3 - 15 - 15 2,3
Probable Deeps 14,9 1,0 3,1 150 458 234 1,6
TOTAL PROBABLE 15,6 1,1 3,1 164 458 249 1,6
Project Ore Reserves estimated using financial assumptions and modifying factors stated in the FS-25. Tonnes are rounded,
which may result in rounding errors. The corresponding Indicated Mineral Resources, disclosed are inclusive of these Ore
Reserves.
The combined Uppers and Deeps Reserve only production profile is shown below. Peak production levels remain
the same as for the LoM plan.
The metal production profile is shown in the table below.
Table 16: Metal production profile.
Metal in concentrate - 000 t Totals Yr 1 Yr 2 Yr 3 Yr 4 Yr 5 Yr 6 Yr 7 Yr 8 Yr 9 Yr 10 Yr 11 Yr 12
Total copper 140,5 - 1,5 4,2 4,6 18,6 22,6 21,2 20,3 20,5 18,2 8,6 0,1
Total zinc 374,4 - 0,0 0,0 0,0 46,7 58,4 55,9 57,0 66,6 61,0 28,1 0,7
Total metal produced 514,8 - 1,5 4,2 4,6 65,3 81,1 77,1 77,3 87,1 79,3 36,7 0,8
Dewatering & Shaft Refurbishment
The Hutchings Shaft and underground workings are currently filled with water to a depth of 265m below surface
and contain a volume of 8.2 million m3 of water. Dewatering of the underground will be carried out with pumping
systems installed successively at four levels in the Hutchings Shaft as described below. Natural ingress of water into
the mine based on historic data and Orion's measurement and estimation over a 7-year period is only a small
volume of 18m3/hr. The contained water in the workings after 23 years without pumping is 8.2 million m3.
Phase 1: Pumping will be done with one submersible pump, which is currently operating in the shaft at 100m 3/h,
pumping up to the 178-Level pump station which is fitted with multi-stage pumps, and then to a surface concrete
holding dam and onto the existing evaporation dam. Forced evaporators will then dispose of the water into the
atmosphere. This is described in more detail later in this section. As more evaporators are installed, an upgrade of
the submersible pumps will increase capacity to 250m3/h then a second submersible pump will be installed
increasing capacity to 500m3/h. Pumping will continue to the 418 Level and permanent settlers and pump systems
will be installed on 310 Level once this level has been de-watered. The pump station on 310 Level will then enable
pumping capacity to increase to 1,000m3/h which will start from the next phase.
Phase 2: At this point the submersible pumps will be replaced by two multi-stage pumps fitted to a floating pontoon
in the shaft which will pump up to 310 Level at 1,000m3/h. Pumping will continue to just below the 758 Level which
will also be equipped with permanent settlers and a pump station.
Phase 3: Pumping from 758 Level will then take place to shaft bottom (1,025 metres) at 1,000m 3/h with the floating
pontoon. Once 957 Level is dewatered the third permanent pump station will be installed which will have two
multi-stage pump and piping systems of 500m3/h each.
Phase 4: Once the 957 Level pump station is operating, two permanent submersible pumps will be installed at shaft
bottom along with one submersible pump in each of the N-W and S-E decline sections of the mine as the last stage
of the Life of Mine pumping system.
The de-watering phase is expected to take 22 months including time allowed for the pump station installations as
described above.
A number of solutions were investigated for the disposal of the water once pumped to surface. Mechanical forced
evaporation was chosen as the most cost-effective method and is widely used in the mining industry for water
disposal. Shaft dewatering was carried out during the Trial Mining exercise with three forced evaporators and the
concept was proven and it was confirmed that the designed evaporation rates are achievable. The evaporators
atomise water, which is blown into the air at high velocity where evaporation takes place as shown in the following
picture from the Trial phase.
Photo 1: Water evaporation on site at PCZM.
Each evaporator will eject water at an estimated rate of approximately 100m 3/h at an anticipated evaporation
efficiency of 35% to 60% depending on the season and time of day. The seasonal spread of evaporation
efficiencies has been used in the overall dewatering calculations based on higher and lower ambient
temperatures. The evaporation units are spaced at 35m to 50m intervals along the evaporation dam wall
depending on prevailing wind directions relative to the layout of the dam. The evaporators are fitted with weather
sensors and programmable logic controllers (PLCs) to regulate pumping rates to maximise the evaporation
efficiency dependant on temperature, wind direction and humidity at the time. The evaporation design also
allows for excess drift whereby if water fallout is expected to reach beyond the perimeter of the evaporation dam,
various evaporators will be shut down by the PLC system.
Based on planned manufacturing schedules from the evaporator vendors, delivery of the units will take place over
a period of eight months (in-line with the increased shaft pumping rates mentioned above) and once the planned
pumping rate of 1,000 m3/h has been reached, 30 forced evaporators will be in place to dispose of the water into
the air.
The effluent remaining in the evaporation dam will be further exposed to natural evaporation. The effluent is
concentrated brine containing an estimated 100,000 tonnes of dry precipitated solids remaining from the
evaporation process. This precipitate will be combined with tailings and if required can be returned to
underground workings as a component of the paste-fill.
Shaft refurbishment
After the mine was closed in 1991, natural ground water was left to fill up the underground workings. This was
expected to have some impact on the integrity of the shaft steel work. Examinations and testing of the shaft
steelwork from surface to 30m below the water level, along with the use of a video camera inspection to 780m
below shaft collar, as well as shaft probing and water quality testing to within 100m of the shaft bottom assisted to
determine that the majority of the shaft is in good order. A thorough analysis was carried out by Dr. Geoff Krige, a
South African structural steel expert with 40 years industry experience who made recommendations on the level
of refurbishment required. Certain areas of the shaft will have 100% replacement such as the shaft skip loading
level, pump and water columns, power cables, communication and signalling cables. The four levels that will be
used as permanent pump stations will have 100% of the steelwork replaced. Buntons and guides will be replaced
on an inspection and assessment basis. It is estimated that 33% of all shaft steel work will be replaced. The shaft
refurbishment will be carried out concurrently with the dewatering process to reduce construction time.
A new tower mounted Koepe rock winder and a refurbished ground mounted double-drum men and material
winder, have been selected for installation. Winder Controls, a local subsidiary of the international Siemag-Tecberg
Group will be responsible for the supply, refurbishment, installation and commissioning of the winders. Roping up
of the winders will be by the PCZM shaft crew. Once the shaft has been dewatered to 957 Level, construction of
the underground infrastructure will begin. By this stage the man and material winder will have been commissioned
enabling the transport of men and equipment into the work areas.
Ore Processing
The Upper Levels Process Plant
The Upper Levels process plant will treat the supergene sulphide ore at 20,000 tonnes per month and will operate
over a five-year period producing a copper concentrate containing zinc which will be penalised at certain
grade thresholds (this is explained further in the Sales and Marketing section). The flotation test-work was carried
out by Brisbane Metallurgical Laboratories with the plant design by ENPROTEC, a South African engineering and
process equipment manufacturing company. A South African engineering company will construct and operate
the plant under a five-year Build-Own-Operate-Transfer (BOOT) contract.
Test-work was carried out from 2017 to 2024 using drill core samples and reverse circulation drilling samples. After
a number of attempts at producing separate Cu and Zn concentrates, this was shown to be not a viable option,
mainly as sphalerite depression was ineffective, as due to the presence of chalcocite and covellite, zinc co-
floated with copper minerals. Discussions had been held with various metals traders and there appeared to be an
appetite for a bulk Cu-Zn concentrate. Later test-work then focussed on producing a bulk Cu concentrate and
maximising its yield and quality which now underpins the chosen flowsheet.
Blasted ore from the Upper Levels mining will be stockpiled on surface and direct loaded with a FEL into a primary
crusher. The following processes will be secondary cone crushing, ball milling and froth flotation. Mass pull will be
between 12% to 15%. A plate and frame filter will de-water the final bulk copper concentrate with a grade range
between 18% to 23%. The variable concentrate grade is due to the underground head grades ranging from 1.5%
to 4.2% copper. The recovery is anticipated to be on average of 85.81% Cu over the LoM. The tonnage ramp-up
will start at 10,000tpm increasing to the steady state capacity of 20,000tpm over three months. An on-site
geological laboratory was constructed during the Trial Mining phase which will be expanded to cater for sample
analysis and assays from the plant. The plant will operate 24/7, 365 days a year with an overall availability of 90%.
The flow-sheet for the plant is shown below.
Figure 12: Upper Level Plant flow chart.
A 13ha tailings storage facility (TSF) was built during Trial Mining for the underground water forced evaporation
proof-of-concept. A new paddock will be added to the TSF to store the Upper-Levels Plant tailings and water
recycling. The Upper-Level Plant will get process water from the Prieska Water Works via an existing pumping and
pipeline system that will be refurbished by the PCZM team. Power for the plant will be supplied from the Eskom
15MVA upgrade that was previously installed during the Trial Mining phase.
Figure 13: Upper-Level Plant layout.
The Deeps Process Plant
The Deeps process plant will treat the Hypogene ore at a steady state rate of 200,000 tonnes per month over the
planned 12-year life. The plant was designed by METC, a South African process engineering company. Ore
processing will involve secondary crushing (following primary crushing underground), SAG milling with a secondary
ball mill and conventional differential froth flotation to produce separate copper and zinc concentrates at target
concentrate grades of at least 20% Cu and 50% Zn. The flowsheet for processing the Deeps material is similar to
that used during the historical mining operations with the addition of fine grinding circuits for both copper and zinc
and splitting zinc flotation into fast and slow-floating circuits. Copper is extracted first followed by zinc and the zinc
tailings will either go to the paste-fill plant or to the tailings storage facility. TSF return water will be recycled to the
plant, where possible. Design make-up water of 0.56 m3/tonne will be required from the Prieska Water Works.
Water from the paste-fill plant will be returned to the tailings thickener as process water for the plant. The overall
utilisation of the plant is planned at 91%. The plant is designed to run with a medium level of automation and will
be primarily operated from a SCADA system in a central control room with staff in the field at the appropriate
functional areas. An on-site laboratory will provide sample analysis for the plant to supplement the on-line analysis
at various points in the process. The plant will be operated by PCZM staff on a 24/7, 365 days basis. Staffing will
leverage off the Upper-Level mining plant as a training facility to develop skills for the Deeps plant operations. The
flowsheet for the Deeps plant is shown below.
Figure 14: PCZM Deeps Plant flow chart.
LoM metal recoveries into concentrates are anticipated to be on average 85.17% for Cu and 83.96% for Zn. This
compares to the historical average numbers of 84.9% and 84.3% respectively. During the ramp up phase of the
Deep processing plant, recoveries are planned to start at 65.2% for copper and 65.8% for zinc, building up to the
steady state numbers over a seven-month period. The tonnage ramp-up will start at 104,000tpm (based on
assumed availability and utilisations) also building to the steady state capacity of 200,000tpm over seven months.
Figure 15: Deeps processing plant and general surface infrastructure.
Tailings Storage Facility
A Tailings Storage Facility (TSF) will be constructed to contain the tailings from the Upper Levels and Deeps
processing plants. All tailings from the Upper-Level plant will be sent to the TSF while approximately 52% of the
Deeps tailings stream will be contained in the TSF with the remainder used in the underground paste-fill. Tailings will
be delivered to the TSF via a single pipeline with an operating and standby pumping system.
The TSF will be developed as an upstream constructed, ring dyke design with a maximum vertical height of 24
metres, a final footprint of 65Ha and a design life of 18.6 years. Over its life, the TSF will be constructed in three lifts.
A penstock system will decant surface water off the TSF into a return water dam located at the toe of the TSF from
where the water will be pumped to TSF Paddock 1 for forced evaporation or recycled back into the process plant.
The TSF liner system is designed as a Class C barrier according to the South African Government guidelines. This
has a compacted in-situ soil foundation layer with a minimum thickness of 200mm, a single 1.5 mm HDPE liner sitting
below leakage detection drains consisting of perforated HDPE pipes with a 100mm sand layer cover. The TSF will
be built in stages as the construction and operations of the mine take place. The first section will be the
evaporation pond for use during the forced evaporation from the shaft de-watering, after which, TSF "Paddock
2" will be built to accommodate the tailings from the Upper Levels process plant and finally the remainder of the
TSF will be completed for the Deeps mining operations.
Figure 16: plan view of the final TSF footprint.
Top-soil removed during the construction of the TSF will be stockpiles for later rehabilitation.
Following a slope failure analysis, the proposed design of the TSF has sufficient resistance to slope failure for the
loading conditions prescribed by South African National Standard (SANS) 10286 and the Global Industry Standard
on Tailings Management (GISTM) (2020). The SANS 10286 standard specifies a Safety Classification rating to be
determined for the TSF design based on four parameters that for PCZM have been rated at zero or low. This gives
an overall risk rating of Low for the TSF. One of the main factors determining the risk rating is damage and loss
within the zone of influence from a potential dam failure. As can be seen from the diagram below, there is no
habitation or infrastructure within the planned TSF zone of Influence.
Figure 17: TSF planned zone of influence.
Concurrent rehabilitation and closure of the TSF at the end of the mine's life is included in the operating budget
which also allows for maintenance of the site for up to five years after completion of the closure works.
Capex
The capital cost (Capex) including contingency to construct the Upper Levels mine is estimated to be ZAR611
million and the Deeps mine capex is estimated to be ZAR6,981 million giving a total of ZAR7,592 million.
Contingency for the Uppers and Deeps total is 11%. The following table summarises the capital estimates.
Table 17: Capex estimates.
Capital - ZAR Million (LoM Plans) Upper Levels Deeps Total
Accommodation camp construction 63 63
Accommodation camp operating cost 79 79
Bulk Power Supply 377 377
Bulk Water 30 30
EPCM 280 280
Cuprum 132kV Feeder Bay Upgrade (15MVA) 1 1
Decline Rehab 406 406
Evaporation Capital 43 43
Install and commission Man winder 218 218
Install and commission Rock winder 219 219
Mining Fleet 246 768 1015
Owners Team 191 191
Backfill/Paste plant 13 531 544
Process Plant 226 1 607 1 833
Project services 23 23
Dewatering 133 133
Shaft refurbishment 88 88
Surface infrastructure 40 245 286
Surface Ventilation 92 92
Tailings Storage Facility 186 186
UG mining construction 435 435
Ventilation Raise bore holes 59 59
Laboratory 5 29 34
Drilling Related Cost 2 2
Operational Readiness 15 15
Exploration Costs 30 100 130
Contingency 34 780 814
Total 611 6 981 7 592
Opex
Operating costs (Opex) for all disciplines have been built up from first principles using up to date consumable
prices or where applicable from contractor's tendered prices. Labour costs are included within each discipline
which is from detailed labour profiles for each of the operating areas including management and is based on
2024 South African industry benchmarked wage costs including all benefits giving a total cost to company.
The opex costs for the Upper Level and Deeps mining sections are shown in the table below.
Table 18: Opex costs for the Upper Level and Deeps mining sections.
Upper Levels Deep Levels
Summary Opex ZAR/RoM t ZAR/RoM t
Mining 1 169 596
Ore Processing 477 239
Shaft and Winders 0 37
Surface & Indirects 551 106
Concentrate Transport Charges 184 173
Corporate Costs 147 16
Off-mine Costs 32 28
Royalties (Government) 36 80
Sustaining Capex 52 57
Total 2 648 1 331
Generally, the unit costs for the Upper-Level section are higher due to much lower production volumes compared
to the Deeps section.
Product Sales & Transport Logistics.
PCZM received a proposal from an international metals trader (the Trader) for off-take agreements for the Uppers
and Deeps concentrates. There are distinct payment terms and discounts for the different concentrates which
underpin the respective NSR calculations which are explained further in the sections below. Transport of the
concentrates will be by road to port for export shipping assuming a Chinese port destination.
Upper Levels Product Sales
The Uppers will produce a copper concentrate containing zinc which is not payable due its grade being below
payable levels. If the copper concentrate grade is below 20%, with a minimum of 12%, there will be no credit or
penalty for the zinc and also no other penalty elements will apply. Payability is actual Cu concentrate grade – 1%.
The TC/RCs will be on a sliding scale based on the Cu grade starting at USD50/tonne of concentrate and 5 cents/lb
then increasing in a linear manner up to USD85/tonne and 8 cents/lb. The minimum Upper Levels concentrate
grade is expected to be 14% and using a Cu price of USD10,004/t which is estimated when production begins, this
gives an NSR ranging from 87.6% to 88.6% as shown in the table below.
Table 19: Upper Levels NSR calculation for concentrate grade below 20%.
Parameter Cu conc grade range > 12% - 13% 13% - 14% 14% - 15% 15% - 16% 16% - 17% 17% - 18% 18% - 19% 19% - 20%
Cu price (USD/t) 10 004 10 004 10 004 10 004 10 004 10 004 10 004 10 004
Supergene conc Cu grade 12,50% 13,50% 14,50% 15,50% 16,50% 17,50% 18,50% 19,50%
Cu value per t of conc (USD/t) 1 251 1 351 1 451 1 551 1 651 1 751 1 851 1 951
Cu grade - 1% 11,5% 12,5% 13,5% 14,5% 15,5% 16,5% 17,5% 18,5%
Payable Cu value (USD/t of conc) 1 150 1 251 1 351 1 451 1 551 1 651 1 751 1 851
Treatment cost (USD/t of conc) 50,00 55,00 60,00 65,00 70,00 75,00 80,00 85,00
Refining cost (USD/lb of Cu) 0,050 0,055 0,060 0,065 0,070 0,075 0,080 0,085
Refining cost (USD/t of conc) 13,78 16,36 19,17 22,21 25,46 28,93 32,62 36,53
Cu value per t of conc 1 087 1 179 1 271 1 363 1 455 1 547 1 638 1 729
Supergene Cu NSR 86,9% 87,3% 87,6% 87,9% 88,2% 88,3% 88,5% 88,6%
Where the Uppers concentrate Cu grade is above 20%, the payment mechanism will be for a normal copper
concentrate including minor credits for gold and silver by-products, as considered by Traders when proposing
payment terms for Cu in concentrate. Penalties for the relevant impurity elements, will also be included, which in
the case of the Uppers will be zinc only. Copper payability will be actual concentrate grade minus 1%. In this case,
the TC/RCs will be based on annual industry benchmarks minus the Trader's discount of 20%. The PCZM Study is
using the expected 2025 benchmark terms of USD35/tonne and 3.5 cents/lb giving USD28/tonne and 2.8 cents/lb
after the discount. The table below summarises the calculations giving an NSR of 108.5% as derived from offtake
proposals received from reputable traders.
Table 20: Upper Levels NSR calculation for concentrate grade above 20%.
Upper Levels
Parameter Metric
Copper
Gross Cu metal price USD/t Metal 10 004
Concentrate grade % 24,02%
Cu value contained in conc USD/t concentrate 2 403
Payability minimum grade deduction % 1,0%
Payable Cu metal value USD/t concentrate 2 303
Payability deduction USD/t concentrate -100
Gold price USD/oz 2 437
Silver price USD/oz 30,40
By-product credits (Au & Ag) USD/t concentrate 406
TCs & RCs USD/t concentrate -61
Penalties (Zn only) USD/t concentrate -40
Net Smelter Return (NSR) USD/t concentrate 2 608
NSR Percentage % 108,5%
Deeps Product Sales
The Deeps will produce separate copper and zinc concentrates. Payability will be actual Cu concentrate grade
of 20% minus 1% and Zn actual concentrate grade of 50% minus 8%. The Cu concentrate will contain payable
quantities of gold and silver and has Zn and Cl penalties. There are no credits or penalties for the Zn concentrate
based on assay results being below threshold levels. For the first year of Deeps production planned in 2028,
benchmark TC/RCs for Cu are estimated at USD53/tonne and 5.3 cents/lb giving USD42/tonne and 4.2 cents/lb
after the Trader's 20% discount. The Zn benchmark RCs are estimated at USD37.50/t, being USD30/t after the
discount. This gives a Cu NSR of 102.4%. Similarly to the Upper Levels, gold and silver credits lift the NSR above
100%. For Zn, payability is actual concentrate grade of 50% minus 8% giving a NSR of 81.7%. The Zn NSR is lower
than Cu due to the lower payability and no gold or silver credits offered by the Trader. Using estimated metal
prices for 2028, the summarised calculations are shown below.
Table 21: Deeps sales estimate variables.
Hypogene Hypogene
Parameter Metric Copper Zinc
Gross metal price USD/t Metal 9 369 2 665
Concentrate grade % 20% 50%
Gross metal value USD/t concentrate 1 827 1 333
Payability minimum grade deduction % 1% 8%
Payable metal value USD/t concentrate 1 733 1 119
Payability deduction USD/t concentrate -94 -213
By-product credits - Au + Ag USD/t concentrate 220,81 0,00
TCs & RCs USD/t concentrate -62,95 -30,00
Penalties (Zn, Cl) USD/t concentrate -19,96 0,00
Net Smelter Return (NSR) USD/t concentrate 1 871 1 089
NSR Percentage % 102,4% 81,7%
Concentrate Transport logistics
The Port of Ngqura 25km, northeast of the city of Gqeberha (formerly Port Elizabeth), is the preferred export port
for the PCZM concentrates. The port has road and rail infrastructure that can handle both bulk and containerised
cargoes. It is the newest port in South Africa. The concentrates will be road trucked from the mine site to the port.
Due to the relatively low concentrate volumes of around 1,600 tonnes per month produced during the Upper
Levels mining, export via containers is the most effective shipping method. This allows smaller loads to be shipped
more regularly and as required, compared to bulk shipping which requires ship holds to be fully loaded. During the
Deeps mining phase, at steady state, average production levels will be 10,500 tonnes per month of zinc
concentrate and 9,200 tonnes of copper concentrate – a total of 19,700 tonnes. Bulk shipping will be used in this
case and also as these volumes are too high for containers.
A proposal from a logistics vendor has provided the trucking and port costs with sampling and assay costs included
based on market rates compiled by the PCZM team. Shipping costs have been provided by brokers through a
logistic consultant acting for Orion. These costs are outlined in the following sections.
Upper Levels logistics
The table below shows the estimated transport logistics cost for the Upper Levels Supergene concentrate based
on the average steady state production levels. The container shipping rate to China has been estimated at
USD42.50/t. The total logistics cost is USD9.54 per tonne treated (ZAR180/t).
Table 22: Transport logistics costs – Upper-Level Supergene concentrates.
Upper Levels - Supergene Units Supergene
Site loading + road transport to port Cu
Road from site to Ngqura Port (bulk) ZAR/t 635
Port & ship loading costs - containers for Supergene ZAR/t 395
General charges and agency fees ZAR/t 10
Subtotal - transport to port ZAR/t 1040
Concentrate testing
Sampling, moisture and assay/tonne of concentrate ZAR/t 64
Subtotal ZAR costs per tonne of concentrate ZAR/t 1 104
FX ZAR:USD 18,90
Subtotal USD per tonne of concentrate USD/t 58,39
Shipping
Containers for Supergene USD/t 42,50
Total USD per tonne of concentrate USD/t 100,89
Concentrate produced – steady state
Average dry tonnes of concentrate produced tpm 1 720
Moisture Content % 10%
Concentrate tonnes transported - wet tpm 1 892
Total concentrate transport cost USD/month 190 890
Total transport cost per tonne of wet concentrate USD/t 100,89
Tonnes treated tpm 20 000
Concentrate transport cost per tonne treated - USD USD/t 9,54
Concentrate transport cost per tonne treated - ZAR ZAR/t 180
Source: Prieska - Conc transport costs (Jan 2025) V8
Deeps logistics
The Deeps Hypogene production will start ramping up while the Upper Levels is still in production so the two plants
will be operating simultaneously for 16months, and the transport vendor will be loading three separate
concentrates. Bulk cargo from Ngqura is in the region of USD26/tonne for based on current rates. When the Deeps
production starts in 2028, rates have been estimated at USD30/t of concentrate and to account for possible
increases into the future, USD35/t is estimated from 2032 onwards – in real terms.
The table below shows the estimated transport and logistics cost for the Deeps concentrates based on the
average monthly steady state production. The overall logistics costs for the two shipping rates are USD8.57 and
USD9.11 per tonne treated respectively (ZAR162/t and ZAR172/t) as shown in the table below.
Table 23: Transport logistics costs – Deeps concentrates.
Deeps - Hypogene Units USD30/t USD35/t
Site loading + road transport to port Cu & Zn Cu & Zn
Road from site to Ngqura Port - bulk ZAR/t 635 635
Port & ship loading costs - bulk ZAR/t 235 235
General charges and agency fees ZAR/t 10 10
Subtotal - transport to port ZAR/t 880 880
Concentrate testing
Sampling, moisture and assay/tonne of concentrate ZAR/t 50 50
TML tests (2 x pa)/tonne of concentrate 1 ZAR/t 0,04 0,04
Subtotal ZAR costs per tonne of concentrate ZAR/t 930 930
FX ZAR:USD 18,90 18,90
Subtotal USD per tonne of concentrate USD/t 49,21 49,21
Shipping
Bulk for Hypergene USD/t 30 35
Total USD per tonne of concentrate USD/t 79,21 84,21
Concentrate produced – monthly steady state
Dry tonnes of concentrate produced tpm 19 678 19 678
Moisture Content % 10% 10%
Concentrate tonnes transported - wet tpm 21 645 21 645
Total concentrate transport cost USD/month 1 714 498 1 822 724
Total transport cost per tonne of wet concentrate USD/t 79,21 84,21
Steady state tonnes treated tpm 200 000 200 000
Concentrate transport cost per tonne treated - USD USD/t 8,57 9,11
Concentrate transport cost per tonne treated - ZAR ZAR/t 162 172
Source: Prieska - Conc transport costs (Jan 2025) V7
TML = Transportable Moisture Limit, the test to determine that concentrate
1
moisture meets shipping specifications.
Dedicated staff in the PCZM team will provide the overall management of the sales process in conjunction with
the transport logistics vendor.
Environment, Social and Governance
Orion has established a Sustainability Framework based on continual improvement and has laid the foundation of
its sustainability journey through the identification of its priority United Nations Sustainable Development Goals (UN
SDGs) which align with a future-proofing approach to protecting the environment, investment in host communities
and commitments to economic development through maximising local employment and procurement.
All required environmental studies have been completed for PCZM and statutory environmental licensing has
been concluded as shown below.
Table 24: Environmental permitting – PCZM.
Environmental Permit PCZM Mining Right Vardocube Mining Right
Granted 3 July 2019
Environmental Authorisation (correction issued 4 August Granted 3 March 2020
2020)
Environmental Authorisation Amendment Not Applicable Granted 13 October 2021
Waste Management Licence Granted 3 July 2019 Not Applicable
Integrated Water Use Licence 3 August 2020
Integrated Water Use Licence 19 December 2023 Not Applicable
Amendment
Land Rezoning to 'Extractive Industry' Approved October 2020 Approved October 2020
SARAO Square Kilometre Array (SKA)
Permitting Compliant Not Applicable
The SKA permit is related to Government satellite equipment (installed and to be installed) in the Northern Cape
which is part of the international SKA project. The PCZM site is located close to the boundary of the zone of inclusion
of the SKA designated area and therefore requires some of the mine's existing and planned electrical
infrastructure to be permitted with SARAO, the applicable Government body.
Key amendments to the Water Use Licence have been approved, the remainder will be managed and reported
on annually, including that for the Integrated Water and Waste Management Plan (IWWMP). Environmental
Management Programs (EMPr) and financial provisions are in place for each mining right which form part of the
approved Environmental Authorisations (EA) and ensure compliance with all in-country legal requirements
including the National Environmental Management Act,1998 (NEMA) as well as the Equator Principles and
International Finance Corporation Performance Standards. PCZM is to be developed targeting eventual
achievement of a carbon neutral footprint for all metal produced.
Environmental site monitoring and external, legislated reporting systems are in place. This includes groundwater
monitoring of boreholes drilled within the PCZM site and systematic alien vegetation management, mitigation or
removal. Annual environmental audits and financial provision audits have been done by independent, external
Environmental assessment Practitioners (EAP) and submitted to the authorities. Based on the PCZM Environmental
Impact Assessment study, no animal, mammal, reptile or bird species are at significant risk within the PCZM licence
area.
The historical TSF is subject to the closure certificate issued by the Department of Minerals and Energy Affairs for
PCML in 1995. PCZM has measured elevated concentrations of sulphate adjacent to the historical TSF and will
continue to report on the inherited contaminated groundwater quality in the annual update of the IWWMP,
according to the monitoring requirements of the WUL.
Including the town of Prieska, there are four communities associated with PCZM with a total population of
approximately 19,000 people. Community engagement has been underway since 2018 including the
establishment of an active Stakeholder Engagement Forum to share information and discuss relevant strategies
on PCZM with all local stakeholders. A Stakeholder workshop resulted in a commitment by all the participants to
work towards aspirational targets of 50% host community employment, 30% host community procurement and
40% contracting opportunities at PCZM. A Task Team was set-up and made responsible for developing an
implementation and monitoring plan to achieve the aspirational targets.
Following on from the original Social and Labour Plan (SLP) lodged with the Mining Right applications in 2018, a
new detailed 'second cycle' SLP for the period 2025 – 2029 was developed following extensive consultation with
host community stakeholders and was submitted for approval to the DMPR in November 2024. In total a budget
of ZAR440 million has been allocated over the life of the mine for SLP expenditure.
Orion has won a number of awards in recognition of its ESG approach in the emerging and junior mining ESG
categories at the Australian Down Under conference in Perth (2020, 2023, 2024) and the African Mining Indaba in
Cape Town (2022).
Health, Safety and Security
Provisions have been made for resources and budgets to comply with the regulatory requirements of the South
African Mine Health and Safety (MHS) Act, 1996 and the Mineral and Petroleum Resources Development Act,
2002. A PCZM Mine Health and Safety Management System will be developed and implemented prior to the
commencement of the Project. This will include regulatory medical surveillance which has been underway for a
number of years at the site since various work activities started.
In terms of the MHS Act Chapter 2, the employer must prepare and implement a Code of Practice (CoP) on any
matter affecting the health and safety of employees and other persons who may be directly affected by activities
at the mine, which must comply with guidelines issued by the Chief Inspector of Mines. Since work has been taking
place in the Upper Levels of the mine seventeen COP's have already been compiled and implemented by PCZM.
Additional CoPs will be developed prior to the start of construction dealing with the relevant new activities and
for the planned mining operations.
A Major Incident Recovery Plan has been developed to provide a clear and effective communications plan for
the internal management of crisis situations. This will be reviewed and updated prior to the commencement of
the construction phase.
Security systems will be provided at PCZM to ensure a safe and secure operating environment for the staff,
contractors and visitors. The selected systems will protect the premises, physical assets and property as well as
Orion's reputation. An Orion Group Security Adviser has been employed who continuously assesses and updates
the security risk environment at the site an in the local community. Four layers to the security strategy have been
laid out, being:
1. Prevention - physical barriers including, electrified fences, gates, signs, locks and turnstiles;
2. Detection – a central control room will provide monitoring and surveillance based on CCTV systems,
drones, optical beams and alarm systems;
3. Control - guard patrols, emergency response, investigations, and operational management from the
control room, and security advisory services; and
4. Mitigation - security risk and threats assessments will be conducted regularly to identify all potential risks
and or sub-standard security related acts or conditions. These assessments will be conducted in
consultation with all relevant parties and stakeholders and will be documented and communicated with
the relevant role players.
During the construction phase the perimeter of the mining site will be fenced off. There will be a security checkpoint
and entrance to the site for day to day personal and visitors. A second security checkpoint and entrance will be
installed for vehicle access for materials and goods delivered to site and for the movement of concentrate off-
site.
Risk Assessment
A risk workshop was held during the 2020 BFS where 103 risk items were tabled. The list has been reviewed and
updated a number of times, more recently in September 2024 and February 2025. Following the latest review and
after allowing for mitigating actions, the risks with a residual rating of Significant or higher have been highlighted
as the top risk events to be managed and monitored as shown below. The remaining risks will undergo regular
reviews and monitoring.
Figure 18: Risk assessment indicators.
The risks associated with structural failure and zone of influence of the TSF were assessed and allowing for
mitigation, a risk rating of 12 (Medium) was assigned to the TSF. Increased geopolitical risk, with relation to the USA,
has emerged as a potential risk, that needs to be considered in more detail. It is provisionally given a risk rating of
15 (Significant).
Execution & Operational Readiness
Execution strategy
The execution of the construction phase of the project is planned to be implemented by a combination of EPCM,
EPC and Owner's Team led work packages. The following packages have been selected for EPCM contracts:
1. Deeps process plant;
2. Deeps paste-fill plant;
3. Site-wide electrical reticulation;
4. Shaft winders installation;
5. Deeps surface fans; and
6. Deeps Sewage plant.
One area of the project will be constructed under EPC (fixed price) contract arrangements:
1. The Upper Levels process plant using a BOOT methodology (build, operate, own and transfer).
Process guarantees will be included in both process plant construction contracts.
The remaining areas of the project will be managed by PCZM Owner's Teams using a combination of PCZM
employees and specialised contractors with detailed design carried out by external consulting engineers,
procurement by PCZM and QA/QC by external parties.
1. All general surface construction, e.g. offices, workshops, roads;
2. Shaft de-watering;
3. Shaft rehabilitation & equipping;
4. Bulk water – Prieska water works upgrade and pipeline;
5. Surface water handling, the forced evaporators and related piping and pumping;
6. Underground construction;
7. TSF and related piping and pumping; and
8. Expansion of the existing on-site accommodation camp.
By increasing construction activities managed by the Owner's Team and reducing the reliance on EPCM
contractors, this will decrease P&Gs costs and potential standing time claims as well as eliminating the EPCM
contractor's profit margin in these selected areas.
The PCZM Project will be executed with the appropriate governance structures in place. In addition to the Project
Execution Team shown in the organogram above, there will be a Steering Committee sponsored and chaired by
the Orion Chief Operating Officer with executive and technical team representation. There will be a Steering
Committee charter and terms of reference in place to ensure clear roles and responsibilities as well as delegation
of authority specifically developed to suit the smooth running of a major capital project. The Steering Committee
serves as an assurance function for the Project Execution Team who will regularly present the following:
1. Adherence to the execution strategy;
2. Safety, schedule, cost and quality metrics;
3. Risk updates;
4. Environmental compliance and community relations; and
5. Change management issues.
It is incumbent upon the Steering Committee to advise the Project Execution Team on potential external risks,
required actions and preferential decisions if necessary. It is not the role of the Steering Committee to run the
project.
A summary of the key schedule activities from project start-up to production from the Deeps processing plant is
shown below.
Figure 19: Project key activities – from start up to production.
Following the release of the DFS, Front End Engineering Design (FEED) will take place in preparation for the
anticipated construction phase. The main activities of the FEED phase are outlined below:
1. Design drawings will be advanced;
2. Capex estimates will be updated where necessary;
3. Update and refine the construction schedule;
4. Procurement packages will be defined with a procurement operating plan and planning for local
procurement. Including a focus on long-lead items;
5. Additional owner's team members will be recruited;
6. Contracts prepared for EPC/EPCM contractors and external detailed design and QA/QC work;
7. Project management systems will be implemented;
8. Update the Risk Register;
9. Confirm concentrate transport and sales contracts; and
10. Start Operational Readiness planning.
The FEED phase will take place over a 6-month period while the funding is being finalised and will be managed by
the existing Owner's Team.
The Operational Readiness plan is a key step in the preparation of moving from the construction phase to the
operations phase. The following main items will be addressed during this phase:
1. The hiring and employing of labour and the various contractors required for the production phase,
including planning for entry medical examinations, safety inductions, training and accommodation;
2. Ensure that the required statutory positions are recruited;
3. Ensure that all safety related and operating procedures are in place including mandatory Codes of
Practice as stipulated in the Regulations of the Mine Health and Safety Act (1996);
4. Planning for the installation and implementation of the required management and accounting systems
and IT, computer hardware and software packages;
5. Ensure that all relevant chemical and explosives data sheets are in place and the proper procedures for
transport, storage and handling of these have been prepared;
6. Put operating strategies and procedures in place;
7. Ordering and procuring the relevant production equipment. Cognisance needs to be taken of long lead
items so that these are delivered to site as per the planned schedule, underground mining fleet being a
key example;
8. Ordering and procuring first fills, operational consumables and critical spares required for the production
process and infrastructure;
9. Ensuring that process guarantees, and equipment warranty documentation is available and filed;
10. Ensure that all required security measures are in place, both from a personal perspective and for asset
and product protection; and
11. Ensure that all required insurance policies are in place.
The construction Owner's Team structure is shown below outlining the four teams that will manage the EPCM/EPC
contracts and the Owner lead work packages. This team will be supported by service departments including, HR,
finance, environmental, ESG, legal and security.
Figure 20: Organogram of the Owners Construction Team.
Currently, there are a number of legal appointments in place relevant to the level of work on-site. During the
construction and operational phases, the further legal appointments will be put in place.
Project Funding
Orion is listed on the Australian Securities Exchange (ASX: ORN) and has a secondary listing on the Main Board of
the Johannesburg Stock Exchange (JSE: ORN). Orion currently intends to fund the development of the Project by
means of a combination of debt and equity.
Triple Flag Funding Arrangements
In December 2022, Orion signed definitive agreements with Triple Flag Precious Metals Corp. (TSX/NYSE: TFPM) (with
its subsidiaries, Triple Flag) for a USD87 million (~AUD127 million) secured funding package for PCZM made up of a
precious metals stream (Precious Metal Stream) and an additional early funding arrangement (Funding
Arrangement) (refer ASX release13 December 2022). The Precious Metal Stream, which comprises USD80 million
(~AUD117 million) of funding to be drawn down in tranches, alongside other bank and/or third-party funding
during mine development, is conditional on the mine development being fully funded, finalisation of an
executable mine plan to Triple Flag's satisfaction, South African regulatory approvals, and fulfilment of drawdown
conditions standard for such arrangements. Triple Flag has also provided an additional AUD10 million (~USD7
million) Funding Arrangement, to complete the Early Mining Works FS and Dewatering Project which has been fully
drawn down. Under each of the Precious Metal Stream and the Funding Arrangement, PCZM and other obligors
has agreed to grant a first ranking security in favour of Triple Flag and the IDC over certain assets and claims
related directly and indirectly to PCZM; after which the security in respect of the Precious Metal Stream will be
subordinated to PCZM financiers on terms to be agreed in an intercreditor arrangement that is consistent with the
principles set out in the Precious Metal Stream agreement.
Opportunities
Key Project opportunities for future consideration include:
Mineral Resources Extension Potential
• Conversion of delineated Inferred Mineral Resources into Indicated Mineral Resource to upgrade the
mining plan;
• Extensional exploration and 'out of resource' mineralisation that can possibly be converted in reported
Mineral Resources;
• Near-mine and satellite exploration potential; and
• Remnant pillar extraction.
Mining Operations Opportunities
• Fleet Automation and Diesel versus Electric underground vehicles;
• Trade-off study between the planned rail transfer methodology and other appropriate alternatives;
and
• Mine to Market Optimisation studies.
Ore Processing and By-products Opportunities
• Achieve or exceed historic plant performance increasing both metal recovery and concentrate
grades;
• Cyanide Substitution potential;
• Advance studies to maximise water recovery from the TSF;
• Barite by-product recovery potential from run of mine (RoM) and tailings retreatment;
• Pyrite by product recovery from RoM and tailings retreatment; and
• Sorting of crushed ore to pre-concentrate mine head feed and reduce tonnes treated.
Mine Services and Infrastructure Opportunities
• Renewable energy power supply options.
For and on behalf of the Board.
Errol Smart
Managing Director & CEO
28 March 2025
ENQUIRIES
Investors Media JSE Sponsor
Errol Smart – Managing Director & CEO Nicholas Read Monique Martinez
Denis Waddell – Chairman Read Corporate, Australia Merchantec Capital
T: +61 (0) 3 8080 7170 T: +61 (0) 419 929 046 T: +27 (0) 11 325 6363
E: info@orionminerals.com.au E: nicholas@readcorporate.com.au E: monique.martinez@merchantec.com
Competent Person's Statements
The information in this report that relates to Exploration Results is based on information compiled by Mr Paul Matthews
(Pr.Sci.Nat.), a Competent Person who is a member of the South African Council for Natural Scientific Professionals, a
Recognised Professional Organisation (RPO). Mr Matthews is a full-time employee of Orion. Mr Matthews has sufficient
experience that is relevant to the style of mineralisation and type of deposit under consideration and to the activity being
undertaken to qualify as a Competent Person as defined in the 2012 Edition of the JORC Code. Mr Matthews consents to the
inclusion in this announcement of the matters based on his information in the form and context in which it appears.
The information in this report that relates to Mineral Resources is based on information compiled by Mr Sean Duggan, a
Competent Person who is a Director and Principal Analyst at Z Star Mineral Resource Consultants (Pty) Ltd. Mr Duggan
(Pr.Sci.Nat) is registered with the South African Council for Natural Scientific Professionals (Registration No. 400035/01), an RPO.
Mr Duggan has sufficient experience that is relevant to the style of mineralisation and type of deposit under consideration and
to the activity being undertaken to qualify as a Competent Person as defined in the 2012 Edition of the JORC Code. Mr Duggan
consents to the inclusion in this announcement of the matters based on his information in the form and context in which it
appears.
The information in this report that relates to Ore Reserves is based on information compiled under the supervision of Mr Ettienne
Oosthuizen, a Competent Person who is a Member of the South African Institute of Mining and Metallurgy (SAIMM) and a
Member of the Institute of Materials, Minerals and Mining (IMMM), an RPO. Mr Oosthuizen is an employee of A & B Global
Mining (Pty) Ltd which consults to Orion. Mr Oosthuizen has sufficient experience that is relevant to the style of mineralisation
and type of deposit under consideration and to the activity being undertaken to qualify as a Competent Person as defined in
the 2012 Edition of the 'Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves. Mr
Oosthuizen consents to the inclusion in the report of the matters based on his information in the form and context in which it
appears.
The information in this report that relates to Ore Reserves is based on information compiled with the support of Ms Vannessa
Clark, a Competent Person who is a Member of the South African Council for Natural Scientific Professionals, Membership
Number 400161/07, and a Fellow of the Geological Society of South Africa, Membership Number #FME965001, an RPO. Ms
Clark is an employee of Practara (Pty) Ltd which consults to Orion. Ms Clark has sufficient experience that is relevant to the
style of mineralisation and type of deposit under consideration and to the activity being undertaken to qualify as a Competent
Person as defined in the 2012 Edition of the 'Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore
Reserves. Ms Clark consents to the inclusion in the report of the matters based on his information in the form and context in
which it appears.
The information in this report that relates to the metallurgy and processing plant is based on information compiled under the
supervision of Mr John Edwards, a Competent Person who is a Fellow of the South African Institute of Mining and Metallurgy
(SAIMM), an RPO. Mr Edwards is an employee of METC Engineering Ltd, which provides consulting services to Orion. Mr Edwards
has sufficient experience that is relevant to the style of mineralisation and type of deposit under consideration and to the
activity being undertaken to qualify as a Competent Person as defined in the 2012 Edition of the 'Australasian Code for
Reporting of Exploration Results, Mineral Resources and Ore Reserves. Mr Edwards consents to the inclusion in the report of the
matters based on his information in the form and context in which it appears.
Reference to Previous Reports
The Deep Sulphide Mineral Resource was reported in ASX/JSE Release of 18 December 2018: "Landmark Resource Upgrade
Sets Strong Foundation for Development of Prieska Zinc-Copper Project" available to the public on
http://www.orionminerals.com.au/investors/asx-jseannouncements/. Competent Person: Mr. Sean Duggan. Orion confirms it is
not aware of any new information or data that materially affects the information related to the Deep Sulphide Mineral Resource
included in the original market announcement. Orion confirms that all material assumptions and technical parameters
underpinning the Deep Sulphide Mineral Resource in the ASX/JSE Release of 18 December 2018 continue to apply and have
not materially changed. Orion confirms that the form and context in which the Competent Person's findings are presented
here have not been materially modified from the original market announcement.
The +105 Level Mineral Resource (Supergene and Hypogene Sulphide) was reported in ASX/JSE Release of 28 March 2025
"Prieska Crown Pillar +105 Level Mineral Resource Update" available to the public on
http://www.orionminerals.com.au/investors/asx-jseannouncements/. Competent Person: Mr. Sean Duggan. Orion confirms it
is not aware of any new information or data that materially affects the information related to the Supergene and Hypogene
Sulphide Mineral Resources included in the original market announcement. Orion confirms that all material assumptions and
technical parameters underpinning the Supergene and Hypogene Sulphide Mineral Resources in the ASX/JSE Release of 28
March 2025 continue to apply and have not materially changed. Orion confirms that the form and context in which the
Competent Person's findings are presented here have not been materially modified from the original market announcement.
The +105 Level Mineral Resource (HW Oxide and Oxide) was reported in ASX/JSE Release of 25 July 2023: "Prieska Mineral
Resource Increases Ahead of Trial Mining" available to the public on http://www.orionminerals.com.au/investors/asx-
jseannouncements/. Competent Person: Mr. Sean Duggan. Orion confirms it is not aware of any new information or data that
materially affects the information related to the +105 Level HW Oxide and Oxide Mineral Resources included in the original
market announcement. Orion confirms that all material assumptions and technical parameters underpinning the +105 Level in
the ASX/JSE Release of 25 July 2023 continue to apply and have not materially changed. Orion confirms that the form and
context in which the Competent Person's findings are presented here have not been materially modified from the original
market announcement.
Disclaimer
This release may include forward-looking statements. Such forward-looking statements may include, among other things,
statements regarding targets, estimates and assumptions in respect of metal production and prices, operating costs and results,
capital expenditures, mineral reserves and mineral resources and anticipated grades and recovery rates, and are or may be
based on assumptions and estimates related to future technical, economic, market, political, social and other conditions.
These forward-looking statements are based on management's expectations and beliefs concerning future events. Forward-
looking statements inherently involve subjective judgement and analysis and are necessarily subject to risks, uncertainties and
other factors, many of which are outside the control of Orion. Actual results and developments may vary materially from those
expressed in this release. Given these uncertainties, readers are cautioned not to place undue reliance on such forward-
looking statements. Orion makes no undertaking to subsequently update or revise the forward-looking statements made in this
release to reflect events or circumstances after the date of this release. All information in respect of Exploration Results and
other technical information should be read in conjunction with Competent Person Statements in this release (where
applicable). To the maximum extent permitted by law, Orion and any of its related bodies corporate and affiliates and their
officers, employees, agents, associates and advisers:
• disclaim any obligations or undertaking to release any updates or revisions to the information to reflect any change in
expectations or assumptions;
• do not make any representation or warranty, express or implied, as to the accuracy, reliability or completeness of the
information in this release, or likelihood of fulfilment of any forward-looking statement or any event or results expressed or
implied in any forward-looking statement; and
• disclaim all responsibility and liability for these forward-looking statements (including, without limitation, liability for
negligence).
The 2025 Definitive Feasibility Study for Prieska Copper Zinc Mine, including the JORC Table 1, sections 1-4 provided in accordance with the JORC
Code (2012) requirements for Results, Mineral Resources and Ore Reserves for the Prieska Copper Zinc Mine Deep Sulphide Resource and the
+105 Level Resource, is available on Orion's website at:
https://www.orionminerals.com.au/download-category/2025-asx-jse-announcements/
Date: 28-03-2025 10:34:00
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