Tiger Resources Times New Copper Mine to Hit High Price-High Demand Curve

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Researched by Industrial Info Resources (Sugar Land, Texas)--Copper demand is forecast to be much higher than supply in the coming year, as long as the industrial growth recovery maintains its momentum in China and countries belonging to the Organization for Economic Cooperation and Development (OECD). The price push caused by the demand and supply gap will be good news for a number of Africa-based copper mining projects.

Tiger Resources' (ASX:TGS) (Balcatta, Australia) Kipoi copper project in the Democratic Republic of Congo (DRC) began ore- and waste-mining operations in the second week of November. The ore grade material will be stockpiled for the heavy-media separation (HMS) plant, which was manufactured and test run in South Africa and then disassembled into modules for transport to the DRC site. The plant will be erected on site by Group Five (JNB:GRF) (Rivonia, South Africa) in December. Some of the waste material will be used in the construction of infrastructure. Work on the access road and waste dam is under way.

Commercial operations at Kipoi are set to start in the first quarter of 2011. In Phase I of the project, Tiger aims to produce 35,000 tons per year of copper over a period of three years. In the first phase, the high-grade mineralization of the Kipoi deposit will be fully exploited. The Kipoi Central deposit is a very high-grade resource, with 2.86 million tons of ore at 8.1% copper in the midst of a lower-grade deposit. In this phase, a total of 900,000 tons per year of ore with 7% copper will be processed through the HMS plant to produce 35,000 tons per year of copper.

The company is currently conducting a feasibility study on the economic viability of the construction of a solvent extraction/electrowinning plant that could become operational within three years after the start of the HMS plant. In the second stage of the project, ore from Kipoi Central, Kipoi North, Kileba South and other deposits in Kipoi and the Lupoto project will be processed, reports Tiger. The Kipoi project covers an area of 55 square kilometers and is 75 kilometers northwest of Lumumbashi on the Katangan Copperbelt.

Barclays Capital (London, England) has been bullish on the copper price since the beginning of 2010 and predicts that copper inventories are going to hit all-time lows sometime in the middle of 2011, pushing the price of the metal to an all-time high. With the current London Metal Exchange price at about $8,340 per ton, Barclays sees the priced consistently above $9,000 per ton in 2011, peaking to an average of $9,950 per ton in the third quarter. Inventory levels would fall to less than 10 days worth of consumption, compared to an average of four weeks in the recent past.

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