Monsters of Rock: Mine revival experts New Century eye rebirth of Tasmanian copper operation

New Century Resources has announced a 130% increase in reserves at the mothballed Mount Lyell copper mine in Tasmania
The operation could produce the sought after metal for more than a decade
A pre-feasibility study is due in the second half of 2022

New Century Resources (ASX:NCZ) made its name initially off the Dr Frankenstein act it pulled at the old Century Zinc Mine up in Queensland.

Once one of the largest zinc mines in the world, New Century revived the project as a tailings dam retreatment mine after purchasing the mothballed operations back in 2017.

With zinc prices around historic highs, NCZ is on track to deliver $100 million of operational cashflow in FY22 after high prices drove a record $40m haul at EBITDA of $30.4m in the March quarter.

New Century has two big expansion projects on the go, the first is an in-situ processing expansion based around the Silver King and East Fault Block deposits at Century.

The other is probably more exciting, the reopening of the mothballed Mount Lyell copper mine on Tasmania’s west coast, which is itself reemerging as a significant mining postcode.

NCZ took a big step towards that with a new ore reserve, a 130% expansion to 23.9Mt at 1.14% copper equivalent for 246,000t of copper and 198,000oz of gold it says could support a mine life of more than 10 years.

More drilling to improve case for restart

A pre-feasibility study is due at Mt Lyell in the second half of 2022, focused on the main resource areas at Prince Lyell and Western Tharsis.

The company has a decent head start from previous operations at Mt Lyell, with 28km of existing underground development and a processing flowsheet that, with some modernisation to come, has worked well since 1972 delivering historic recoveries of 92-93%.

More drilling is planned to grow the ore reserve at Mt Lyell, especially at Prince Lyell and Western Tharsis, with the updated ore reserve representing only 18% of the current mineral resource. No drilling has been undertaken at the mine since 2015, a year after the operation was placed in mothballs.

That includes underground resources of 71.3Mt at 1.14% CuEq for 734,000t of copper and 588,000oz gold, and open pit resources of 69.1Mt at 0.71% CuEq for 442,000t Cu and 367,000oz Au.

NCZ MD Patrick Walta said the company is eyeing a status as a “green copper” producer, with Tasmania’s bountiful supply of hydroelectric power to make up a core part of its energy needs.

“Mt Lyell is shaping up as one of the largest near-term copper production assets on the ASX, aided by the extensive infrastructure in place and a proven production history of high quality, low-carbon copper, utilising low-cost renewable energy from hydroelectric power,” he said.

“New Century’s restart development work to date has delivered an initial Ore Reserve at Mt Lyell significantly larger than anticipated, with a mine life projected out greater than 10 years on this Ore Reserve alone.

“Material upside is clearly evident within the substantial Prince Lyell and Western Tharsis ore bodies, with drilling to occur during 2022 to realise this upside in Ore Reserve growth.

“The Company is well positioned to bring Mt Lyell through the Restart PFS process and ultimately into production, supplying green copper into a market projected to be in significant supply deficit within the next three to five years.”