Bryah Basin Manganese Joint Venture Project
The Horseshoe Range area has been the main manganese producing region within the Bryah and Padbury Basins, with production dominated by the Horseshoe South Mine, and a smaller satellite deposit at the Horseshoe North Mine. The first production period for these 2 deposits was from 1948 to 1971, when 490,000 tonnes of manganese ore was mined at a reported average grade of 42% Manganese. Process Minerals Limited, a subsidiary of ASX-listed Mineral Resources Limited, produced a further 400,000 tonnes of manganese ore from the Horseshoe South Mine between 2008 and 2011.
Other historical manganese mines within the area are at Mudderwearie, Elsa Mary and Mount Padbury with each reported to have yielded grades exceeding 40% Mn.
Since 2000 only limited manganese exploration has occurred. However, drilling in 2010-2011 identified a number of new manganese deposits under shallow cover. One such discovery, the Horseshoe Flats deposit is located less than 1 km south of the Horseshoe South mine. Manganese mining operations commenced at the Horseshoe Flats in late 2017 with ore being trucked to Port Hedland for export. The deposit has been described as a talus-style deposit which lies near the foot of the Horseshoe Range under shallow transported cover. Exploration for talus-style manganese deposits under shallow cover represents an opportunity for Bryah Resources Limited, which has control of over 60 kilometres of the prospective Horseshoe Range.
Manganese Joint Venture
In April 2019 Bryah Resources Limited announced the execution of a manganese Farm-In and Joint Venture Agreement (Agreement) with OM (Manganese) Limited (OMM), a wholly owned subsidiary of ASX-listed OM Holdings Limited (ASX:OMH).
OM Holdings Limited is a vertically integrated Manganese and Silicon specialist involved in mining, smelting and trading, with operations located in Australia, China, Japan, Malaysia, Singapore and South Africa. In Australia, OMM operates the Bootu Creek manganese mine in the Northern Territory which is due to cease open pit mining operations in 2021.
The Agreement applies to approximately 660km2 of the Company’s Bryah Basin Project in central Western Australia, including the historic Horseshoe South Manganese Mine.
Between April and August 2019, OMM funded $500,000 of project expenditure which yielded highly encouraging manganese drilling results. In August 2019, OMM secured an initial 10% interest in the Manganese Joint Venture (“JV”), following payment of a $250,000 Exercise Fee.
Under Stage 2 of the Agreement, OMM can elect to progressively fund the next $2.0 million of exploration expenditure in four tranches of $500,000 each, to earn up to a 51% interest in the Manganese JV by 30 June 2022.
In June 2020, pursuant to the terms of the Agreement, OMM completed funding $500,000 in project expenditure under Tranche 1, to increase its initial JV interest from 10% to 20%. OMM has formally elected to increase its JV interest to 30% under Tranche 2, funding an additional $500,000 of project expenditure.
Bryah may elect for OMM to fund the next $1.8 million of project expenditure for OMM to earn a 60% Joint Venture Interest. Thereafter Bryah may elect for OMM to fund an additional $2.5 million of project expenditure for OMM to earn a 70% Joint Venture Interest.
The aim of the JV is to explore for commercially mineable manganese and carry out Feasibility Studies. If a positive Feasibility Study is supported by a Decision to Mine, then OMM and Bryah may elect to participate in a Mining Joint Venture in proportion to their JV interests or convert to a Royalty. Bryah is to negotiate a Sales Agency Agreement on commercial terms with OM Holdings Ltd in respect to all manganese ore production under the Mining JV.
The JV includes an area of Mutual Interest which extends for a radius of 100 kilometres from the Horseshoe South Manganese Mine (M52/806).