K.Hill Project Feasibility Study
In 2022, Giyani announced the results of the feasibility study for the K.Hill battery‑grade manganese project in Botswana. The FS has been prepared by SRK, as lead, on an integrated mining and processing operation for the onsite production of HPMSM directly from manganese oxide.
The project is based upon K.Hill’s total Indicated Resource of 2.1 Mt which has been converted into 2.0 Mt of Probable Reserves. The remaining Inferred Resource of 3.1 Mt for K.Hill, is in the process of evaluation to be upgraded into the Indicated Resource category. New Mineral Resource Estimates for K.Hill and the nearby Otse manganese oxide prospect are currently targeted for completion in H1 2023 and provides the potential to expand the Project in future years and extend the mine life significantly.
contingency of US$32M
Robust economic returns:
A post‑tax NPV, at an 8% discount rate, of US$481M (C$649M) and a post‑tax IRR of 28%.
Low capital intensity for what will be one of the largest HPMSM projects in the world
Estimated initial capital expenditure of US$281M (C$379M), including contingency of US$32M (C$43M), for a fully integrated battery raw materials project.
Strong free cash flow
Net free cash flow over the life of the Project is estimated at US$1,093M (C$1,476M), equivalent to US$99M (C$134M) per year with first commercial production in 2025.
Significant geological upside offers potential to expand Project and extend mine life
Exploration work to upgrade the 3.1 Mt of Inferred Resources in the K.Hill southerly extension is progressing and the addition of these resources and the Otse prospect provides the potential to expand the Project in future years and extend the mine life significantly
Operational advantage of higher grade ore and conventional mining
K.Hill's Probable Reserve grade of 18.9% MnO is the highest among its listed battery‑grade manganese peers and underpins a scalable operation with an initial throughput of 200kt ore production per annum, offering potential future production capacity expansion.
LI Battery demand expected to increase significantly
CPM Group, an independent research and consultancy company, projects demand for HPMSM in LI Batteries to grow by nearly 30 times between 2021 and 2036.
Pathway to becoming a low carbon producer
Strong ESG credentials
Optimization work opens opportunities for enhancing Project value
|Type of mine||‑||Conventional open pit mine|
|Type of production facility||‑||HPMSM hydrometallurgical processing facility|
|Life of the Project||years||11.0|
|Net realized price assumption|
|Average realized HPMSM price (Yrs 1 – 5)||$/t||3,373|
|Flat realized price HPMSM price (Yrs 6 – 11)||$/t||3,918|
|Total ore mined||dry kt||226||2,032|
|Run-of-mine manganese grade||% MnO||18.9||18.9|
|Total recovered manganese metal||kt MnO||31||339|
|Total HPMSM produced||kt||73||808|
|Project cash flow||Average annual||LOP|
|Revenue from HPMSM||$M||272||2,993|
|Total operating costs (incl. royalty)||$M||125||1,369|
|Initial capital expenditure excl. contingency||$M||‑||249|
|Contingency on initial capital||$M||-||32|
|Total initial capital expenditure incl. contingency||$M||-||281|
|Sustaining capital expenditure incl. contingency||$M||-||21|
|Total LOP capital expenditure incl. contingency||$M||‑||307|
|NPV (8% real discount rate)||$M||603||481|
|Payback period from start of processing||years||3.3||3.6|
|Cumulative cash flow, undiscounted||$M||1,317||1,093|
All financial figures above are quoted in US dollars
Net realized prices for HPMSM at mine gate, assuming 50% of sales to the European Union and 50% sales to North America.