The Sandfire Resources Ltd (ASX: SFR) share price is up 10% in afternoon trading. This comes following a series of releases to the ASX this morning.
Importantly the announcements include significant new high-grade drilling results at the company's A4 copper silver deposit, along with a detailed strategy update and Sandfire's approval of a new long-life copper mine in Botswana.
We'll look at the details of the new mine below. But first, what's been happening with Sandfire's share price?
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Sandfire's share price on the rebound
Despite today's 10% surge, Sandfire Resources' share price remain down 19% year-to-date.
Like many ASX shares, the company has yet to recover from the bashing it took during the COVID-led market rout earlier in the year. From 20 January through to 23 March, shares fell by 55%. Since the 23 March lows, the share price is up 71%.
By comparison the S&P/ASX 200 Index (ASX: XJO) is up 45% from the 23 March trough.
What did Sandfire announce about its Botswana mine?
In this morning's announcement, Sandfire revealed its board has given the green light to develop the T3 Motheo Copper-Silver Project in the Kalahari Copper Belt in Botswana. The company says this is an important step in its international growth and diversification strategy.
The cost is estimated at $371 million, which includes mining pre-strip, process plant construction, site infrastructure development, tailings storage, owner's costs and contingency.
The company's positive Definitive Feasibility Study (DFS) showed a base case 3.2 million tonnes per annum (Mtpa) operation with the potential for a rapid expansion to 5.2Mtpa.
Forecasting a long-term copper price of US$3.16/lb and all-in sustaining costs of US$1.76/lb for the first 10 years of operations, Sandfire reported an estimated life-of-mine (LOM) revenue of $3.5 billion and earnings before interest, tax, depreciation and amortisation (EBITDA) of $1.4 billion.
The company expects a payback time of 3.8 years from the production start date.
Commenting on the new mine approval, Sandfire's CEO Karl Simich said:
Today we have given the green light to the development of a new, long-life copper operation based on the T3 open pit, which we envisage will become the core of our Motheo Production Hub – a new copper production hub in the central portion of the world-class Kalahari Copper Belt, where we have a dominant 26,645 square kilometre ground-holding in Botswana and Namibia… The key message for our shareholders and investors is that this is the start of a much bigger long-term copper production and exploration story for Sandfire in Botswana…
This is, in effect, the dawn of a new global copper province – as evidenced by the scale of the new underground mining operation currently being constructed immediately to the north-east of our project by Cupric Canyon Capital at their Khoemacau Project.
As the new mine gets underway, the Sandfire Resources' share price will be one to watch.
