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Mineral Commodities (ASX:MRC) has been granted a Section 102 Amended Mining Right for its mineral sands operation in South Africa. This has included approval by the South African authorities (Department of Mineral Resources and Energy) for the additional infrastructure that MRC would require to develop a larger expansion of the mineral-reach beaches at Tormin, north of Cape Town.

MRC is a diversified international mining operation, with sites in South Africa, Australia and the Arctic (Norway). MRC has been focused recently on developing a replenishable mineral sands resource in beach areas on South Africa’s western coast.


Among the expansion developments at Tormin Beach that MRC had on the cards was the connection to grid power via the nearby Eskom renewables wind farm and the relocation of its Primary Beach Concentrator unit to the northern beaches mining area from its original site.

High grade mineral resources replenished by the sea

Mining expansion that has been granted under the Section 102 approval includes access to an additional 43.7 hectares of replenishable placer beach deposits that adjoin the current Tormin Beach mining rights and operations. These beaches are expected to yield similar high-grade resources to those already achieved at the site.

The package also comes with rights to the Inland Strand which represents another 75 hectares of heavy mineral deposits immediately adjacent to the existing mining operations. Recent drilling has confirmed that the western strandline has an up to 23m thick mineralized layer with intersections up to 62% THM.

Other facilities that MRC plans to now build at Tormin Beaches include a new primary concentration unit with a front end feed system and a magnetic separation plant.

“This is a significant turning point in realizing the value of the world class Tormin mineral sands operation,” explained Mark Caruso, Executive Chairman at MRC. “The access to the Northern Beaches has doubled our placer beach mining area, allowing us to properly optimize and manage the ongoing replenishment rate of the existing Tormin and Northern Beach resources.”

The Northern Beaches incorporate 10 beaches north of and adjoining the current beaches that were being mined. The areas unite semi-continuous tenements approximately 23km long covering 398 hectares of beach sands which could hold zircon, rutile, ilmenite and garnet, among others.

The placer beach strandline is undergoing continuous erosion, deposition and replenishment from oceanic storm and wave activity. The heavy minerals on the beach are constantly replenished by the transport of new sediment from deeper waters, much of which has been derived from the erosion of deposits accumulated in the elevated historic beach terraces onto the present beach.

Private placement to fund expansion

Mineral Commodities has also recently gone to the market with an A$6.58m private placement with 32.9m shares being issued at 20c each. This was at a 13% discount to the 15 day volume weighted average price and a 15% discount to the 30 day volume weighted average price.

The money raised by the placement is intended to help fund the mineral sands operation at Tormin now that the requisite licenses have been granted.

Shares in Mineral Commodities are trading in the range of 20-26c. The company has a 52 week high at 30c and a 52 week low of 13c, which occurred during the coronavirus crash. Over the last five years the stock hit peaks of 30c in June 2018 and again in January 2020.

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Please note this article does not constitute investment advice. Investors are encouraged to do their own research beforehand or consult a professional advisor.

Stuart Fieldhouse

Stuart Fieldhouse

Stuart Fieldhouse has spent 25 years in journalism and marketing, including as a wealth management editor for the Financial Times group, covering capital markets and international private banking, and as an investment banking correspondent for Euromoney in Hong Kong. He was the founder editor of The Hedge Fund Journal.

Stuart has worked at CMC Markets, supporting the re-launch of its global financial spread betting and CFD trading platforms. He is also the author of two books on trading, published by Financial Times Pearson. Based in The Armchair Trader’s London office, Stuart continues to advise fund managers, private banks, family offices and other financial institutions.

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