Mining spotlights

Generation Mining

Generation Mining (TSX: GENM; US-OTC: GENMF) forecasts that its Marathon copper-palladium project in northwestern Ontario will produce enough copper to manufacture about 2.8 million electric vehicle batteries over its 12.5-year mine life.

An updated feasibility study on the open-pit project completed at the end of March outlined average annual payable metal of 42 million lb. copper, 168,000 oz. palladium, 38,000 oz. platinum, 12,000 oz. gold and 240,000 oz. silver at life-of-mine all-in sustaining costs of $2.05 per lb. copper-equivalent or $781 per palladium-equivalent ounce.

Marathon’s after-tax net present value (at a 6% discount rate) was estimated at C$1.07 billion and its IRR at 28%, based on three-year trailing average metal prices as of Nov. 1. Initial capital of C$992 million could be repaid in 1.9 years.

The project hosts 244.1 million pit-constrained measured and indicated tonnes grading 0.51 gram palladium, 0.2% copper, 0.17 gram platinum, 0.06 gram gold, and 1.6 grams silver. Inferred resources add 29.8 million tonnes averaging 0.39 gram palladium, 0.22% copper, 0.1 gram palladium, 0.05 gram gold and 1.4 grams silver.

The project is fully permitted for construction federally and is waiting approval on its last permit from the Ontario government.

The 260-km² project, 10 km from the town of Marathon, is near the Trans-Canada Highway and is served by the CPR’s main rail line. A new 230 kilovolt power line from Wawa to Thunder Bay crosses the property.

Key shareholders include Sibanye-Stillwater (NYSE: SBSW; JSE: SSW) (14%), Wheaton Precious Metals (TSX: WPM) (7.6%) and Eric Sprott (6.9%). Generation Mining has a TSX market value of $36.7 million.

Bannerman Energy

Bannerman Energy (ASX: BMN; US-OTC: BNNLF) has started bulk earth works for the construction of its fully permitted Etango uranium project, about 30 km southeast of Swakopmund, a city on the Atlantic coast of Namibia.

Etango is one of the world’s largest undeveloped uranium assets. A definitive feasibility study in December 2022 outlined an open-pit operation that at a throughput rate of 8 million tonnes per year would produce about 3.5 million lb. U₃0₈ annually over a mine life of 15 years. The base case used a uranium price of $65 per lb. and estimated a post-tax NPV (at an 8% discount rate) of $209 million (C$290 million) and post-tax IRR of 17%. Initial capital was pegged at $353 million.

Last year, the company completed a scoping study evaluating future higher throughput and operating scenarios. The first scenario, Etango-XP, examined a post ramp-up expansion in throughput capacity to 16 million tonnes per year. The second scenario, Etango-XT, evaluated an extension of the operation’s life to 27 years.

Etango-XP generated a post-tax NPV (at an 8% discount rate) of $250 million and IRR of 16.9%, and Etango-XT an NPV of $241 million and IRR of 18.6%.

Etango has 32.4 million measured tonnes grading 201 ppm U₃0₈ for 14.3 million lb. contained U₃0₈ and another 345.7 million indicated tonnes grading 195 ppm U₃0₈ for 148.5 million lb. U₃0₈. Inferred resources add 140.6 million tonnes grading 200 ppm U₃0₈ for 62.0 million lb. uranium. The resource used a cut-off grade of 55 ppm U₃0₈.

Bannerman Energy has a market cap of about A$379 million (C$333 million).