Mayur Resources’ mineral sands project at Orokolo Bay, Gulf Province, is close to commencing according to Managing Director Paul Mulder. He highlights the opportunities to Business Advantage PNG.

Mayurs projects in PNG. Credit: Mayur

With the Orokolo Bay mineral sands project, Paul Mulder says there has been ‘a huge amount of work’ with landowner groups and in preparing a bulk sample of the minerals (including titano-magnetite, DMS magnetite, construction sands and a zircon-rich valuable heavy mineral concentrate) for prospective customers.

‘We have to make sure that the customers are comfortable with the product quality, the reliability and the way in which the material physically performs,’ he tells Business Advantage PNG.

‘Laboratory tests have to be done on a new mineral that is coming from a new country. [That is why] you need to do a bulk sample where they can put it into their furnace along side their other material and compare it.

‘Once they get that satisfaction, then they can say they are willing to sign long term customer agreements.’

‘We have really started to hone our focus on industrial minerals and energy. There are plenty of copper gold producers in PNG, and explorers. But there are not many of us in the bulk space and that is what our expertise is in.’

Prospective customers have been identified and ‘they have agreed to receive those samples,’ says Mulder.

Stand alone

Mayur Resources’ Paul Mulder

Projected to last 15 years, the mineral sands project will be ‘stand alone’ operation, says Mulder.

‘It has its own wharf, and it will receive goods, and export goods, off that wharf. It is a very simple operation. We are talking about US$25 million (K88 million) capital expenditure. There are no chemicals, no grinding. It is not difficult terrain.’

He tells Business Advantage PNG the project is being fully funded by a Chinese private group, with Mayur retaining 51 per cent of the ‘future economics’. The strategy means Mayur will not have to raise more capital from its shareholders, he explains.

Capital raising

Mayur Resources is listed on the Australian Securities Exchange and the share price has been weak over the last six months. Last last month, the company successfully listed its PNG copper and gold assets on the TSX-Venture Exchange in Canada as Adyton Resources Corporation, raising C$10.5 million (K29.3 million).

‘The reason we are choosing that jurisdiction [Toronto] is because the capital flows and the appetite out of Canada with regard to opportunities in PNG are, we believe, superior to other exchanges.

‘The market found it very hard to understand and value our portfolio. “Are you a copper/gold producer? Are you mineral sands?” So we have really started to hone our focus on industrial minerals and energy.

‘There are plenty of copper gold producers in PNG, and explorers. But there are not many of us in the bulk space and that is what our expertise is in.’

Post-mine opportunities

Sago Palms. Credit: Wikipedia

Mulder says that the mine area at Orokolo Bay area can later be used to grow sago, based on a technique already being trialled by the International Finance Corporation  (IFC) and Total.

‘On the rehabilitation, there is an opportunity there for us, in short order, to use mechanised sago operations. The productivity and quality [of the IFC’s and Total’s project] has been excellent. We have been able to take the key landowners up to see that operation working and they are very impressed.’

Mulder adds that supply barges for the mineral sands operation could also be used to transport the sago.

‘Basically, you are getting all that product back to Port Moresby for free. There is no logistics cost for the landowners, so they can sell it at a very competitive price because they have produced it on a mechanised basis and basically got free transport.’

Another area of potential is the metal vanadium. Mayur says vanadium redox batteries are superior to lithium batteries and are suitable for providing baseload power.

‘PNG just happens to be endowed with a huge amount of vanadium magnetite, which is [included in] our mineral sands project. We will cooperate with the [government’s] energy company in looking at large-scale vanadium storage.’