BacTech Environmental Corp. (BAC:CSE;BCCEF:OTC;OBT1:FRA) is on track to get the environmental permit for its new bioleaching plant opening next year in Tenguel, Ecuador.
The company has reviewed, and updated technical observations made in its Environmental and Social Impact Assessment (ESIA) and uploaded the document to the country’s Ministry of the Environment to get official study approval. The company said that the permit could come as soon as September.
The permit would validate the project and make it more attractive to potential partners and investors, said Chris Temple, editor, and publisher of The National Investor.
“The importance of environmental permitting being all but a done deal is that it’s going to maybe light a fire under one or more potential sources of money, so they don’t miss out on this,” Temple told Streetwise Reports.
The area in Ecuador also is not new to mining. “It’s an area that has got a mining culture, and now you’ve got a company coming in there that is going to improve the environment and improve wages for the average person," he said.
BacTech and the government in May signed an Investment Protection Agreement (IPA), giving the company a 12-year income tax holiday and international arbitration for disputes.
Covered in the IPA is $95.5 million in plant construction and gold activity through 2024 and additional investments and expansions.
Ecuador’s approved BacTech’s construction permit in March. In July, the company announced it had signed letters of intent with several mining cooperatives to deliver up to 58 tonnes per day (tpd) of gold concentrates to be processed at the new plant. The agreements cover arsenopyrite gold concentrates from three mines and processors.
Using naturally occurring bacteria, bioleaching makes it possible to work with lower-grade ore and recover metals from tailings sites as well as mines. As the company likes to say on its website, “Our bugs eat rocks.”
How? President and Chief Executive Officer Ross Orr said the bacteria chew and oxidize the sulfides in the rock like mortar in a brick wall. Once that mortar is gone, the wall crashes down.
Bioleaching was attempted commercially in South Africa in 1986. There have been more than 20 plants built globally since then.
‘Virtually No Pushback’
Orr said the company was currently working with local communities to carry out the final socialization phase of the environmental license application.
The ESIA turned in by the company includes studies of the environmental, social, economic, and cultural implications of the project.
Orr said the Ecuadorian authorities told them it would take about eight months for the permit to go through, and it’s right on track. The local reaction has been positive as well, he said.
“We’ve had virtually no pushback,” Orr said. “Locals are saying, you know, ‘When do I start my job?’”
It helps that the company is not constructing a mine but a facility that will clean up waste from mines, he said.
“The winners are going to be the people who live there because you’re not dumping arsenic into the rivers,” Orr said. “We’re a processing plant that sits on the surface, and everything is contained.”
The next phase of the ESIA process involves conducting presentations, conducting town halls, and replying to questions from the community.
Plenty of Feed for the Mill
To add to the feed going into the plant, there are 90 small mines in the area that produce significant amounts of arsenic with gold in the area. The plant would about 30,900 ounces Au per year. There is potential for expansion; the total availability of materials in the area is an estimated 250 tonnes per day.
The plant would have pre-tax earnings of about $10.9 million and a two-year payback period, according to data from EPCM Consultores.
BacTech has also opened a pilot facility to recover nickel, cobalt, iron, and a geopolymer product from pyrrhotite concentrates produced over the last 100 years in Sudbury, Ontario.
The company has a market cap of CA$14.8 million with 172 million shares outstanding. It trades in a 52-week range of CA$0.17 and CA$0.08.
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1) Steve Sobek wrote this article for Streetwise Reports LLC. He or members of his household own securities of the following companies mentioned in the article: None. He or members of his household are paid by the following companies mentioned in this article: None.
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