The Ministry of Mines and Energy of Namibia has denied Deep-South Resources’ application to renew its Exclusive Prospecting Licence 3140 for the Habib Copper project.

According to the Ministry, the company’s inability to advance the Licence to Pre-Feasibility and complete the proposed drilling program as planned was cited as the reason for denying the licence renewal application.

In a statement, Deep-South has requested an urgent meeting with the Minister to review and reverse the decision. The Minister has accepted a meeting to discuss the matter. “In the context that the company is well funded and moving ahead with a large development program, the decision of the Minister is surprising and certainly not in the best interest of the development of the mineral resources of Namibia,” said Pierre Léveillé, President & CEO of Deep-South.

The company maintains that the Ministry was kept well apprised, with no objection on their part, of a proposed change from the Pre-Feasibility study to upgraded Preliminary Economic Assessment (PEA) and commencement of a full feasibility study. Moreover, the Ministry issued all permits required for the drilling program and are well aware that Deep-South has completed the drilling program. “We believe that a meeting with the Minister will remove any possible misunderstanding and the situation will be rectified in the shortest time frame possible. We are hopeful that our efforts to meet with the Minister will reach a positive outcome,” Léveillé said.

In its application for renewal and subsequent representations made to the Ministry, the company has clearly demonstrated that it adequately meets the criteria under the Minerals (Prospecting and Mining) Act to justify the renewal of its Licence. Accordingly, Deep-South believes that the refusal is unreasonable.

Program details

Deep-South has demonstrated to the Minister that during the past two tenures (from April 2017 to April 2021), it has invested CAD$ 2 million (N$ 23 million) with the completion of among other things, a NI 43-101 resource estimation, a Preliminary Economic Assessment (PEA), a large two ton sampling and bio heap-leach test, geological mapping, modelling and an upgraded PEA. Furthermore, in its renewal application, Deep-South has proposed a Feasibility Study program with a budget of CAD$ 7.1 million (N$ 80 million).

The program was underway with 3 drills and 42 employees on site. METS and CSIRO of Australia have also begun metallurgical tests, bio-leaching, High Pressure Grinding Roller tests and a flow sheet optimization program in two laboratories in Australia. Knight Piesold also has 4 scoping studies underway covering water usage, alternative power solutions and leach pad assessment and environmental path to the ESIA. Deep-South has also informed the Ministry that at the completion of the Feasibility Study, it is planning to build a pilot plant on site for an estimated cost of CAD$ 25.5 million (N$ 286 million).

As a result of the Minister’s refusal to renew the Licence, Deep-South has immediately suspended all work on site and hopes that the retrenchment of its employees will be avoided.

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