Namibia top court hands Deep-South small win in battle for copper project

Deep-South Resources (TSXV: DSM) has scored a small but key win in its battle to renew the company's prospecting licence for the Haib copper project in Namibia, as the country's High Court has ruled no permits over the same area can be granted for now.

The Vancouver-based company took Namibia's Ministry of Mines and Energy to court in July after it refused to renew the company's permit. Deep-South initially believed the denial was a misunderstanding but was then told it was due to its "inability" to advance to prefeasibility and complete the proposed drilling programme as planned.

Deep-South Resources argues that it has clearly demonstrated meeting all the criteria to justify a renewal. It insists the ministry was kept well-informed and had not objected to a proposed change to an upgraded preliminary economic assessment and a full feasibility study, already started.

The Haib copper deposit is in the extreme south of Namibia close to the border with South Africa, which is defined by the course of the Orange River. Credit: Deep-South Resources.

The High Court's ruling affects Orange River Exploration and Mining, which had applied for an exclusive prospecting licence covering the Haib copper deposit in November last year.

The case will return to court on September 16, when the judge is expected to define the next steps in reviewing the non-renewal decision by minister Tom Alweendo.

Deep-South Resources stopped all work on site in June and is now in the process of laying off workers.

The company had acquired the remainder of the project in 2017 from Teck Resources (TSX: TECK.A/TECK.B/ NYSE: TECK), which is one of its major shareholders.

The updated PEA in December had put Haib's after-tax net present value (at a 7.5% discount rate) at US$957 million and internal rate of return at 29.7% using a US$3 per lb. copper price, envisaging a 24-year mine producing 35,332 tonnes of copper cathode and 51,080 tonnes of copper sulphate a year.

Deep-South Resources is also investigating its international legal options and will disclose its strategy in due course.