Vedanta Resources is building the Gamsberg zinc mine in South Africa with an 8.7 billion rand investment. The mine will produce 250,000 tonnes of zinc concentrate annually, with 150,000 tonnes processed at Namibia's Scorpion plant and 100,000 tonnes sold on the open market. A modular approach starting at 4 million tonnes per year, rather than the original 10 million tonne design, makes the project financially viable.
Chapters
major economic boost not only for the Northern Cape but also for South Africa and the mining industry. Um, earlier on we witnessed the first blast at the Hamsberg Zinc Mine here in Achenaze. Now, in 2010, Vedanta Resources bought Hamsberg deposit and Scorpion mine in Namibia as a package deal in zinc acid by Anglo American. And now last year, they announced that they are going to invest 8.7 billion rand to build the Hamsberg mine over a 3-year period. 250,000, um, of zinc in concentrate will be produced, um, by them, by the mine, um, annually. 150,000 of, um, those zinc will, um, will go to its Scorpion mine in Namibia to be processed into metal. Um, now the remaining 100,000 will be sold, um, on the open market.
The Humsberg mine is a sulfide mine, so we've had to change the front end of the Scorpion plant to co-treat sulfides and oxides in order to be, you know, for us to take out this manganese. I think that is the game changer. The other game changer is that, you know, Anglo always envisaged a mega project, so like a 10 million tonne run of mine, 450,000 tonnes of metal in concentrate. Which would have likely been, you know, you had to have refined it on site because from a logistics point of view, you wouldn't be able to move those tonnages. We are doing this modular, 4 million tonnes, 250 phase 1, and then we'll ramp it up thereafter. I think from the Scorpion issue as well as the modular approach in mining is why we've made this project work now.
And how much have you spent and how much do you envisage spending?
Phase 1, when you first met me, we spoke about a $600 million project to build a mine as well as the plant. We've actually shaved off close to $200 million of that price tag. And the way we've been able to do that is the project was initially going to be an owner-mined. And then given ramp-up issues skills issues, et cetera. We could do it, but I didn't want to jeopardize the timeline. So we are going to go contract mining. So contract mining, as you know, is not as capital intensive upfront because we won't have to buy our own fleet. In addition, the team has really looked at, you know, the water lines to the power lines. And from re-engineering, redesigning, and better negotiations on contracts, we managed to shave off $200 million.
