Metro Mining’s Bauxite Reserves Fall to 77.7Mt as AUD 28.3m Growth Plan Unfolds

Context of the Update

Metro Mining Limited (ASX: MMI) has released its annual JORC Ore Reserve and Resource update for the Bauxite Hills Mine, effective as of 31 December 2024. The report reflects the natural depletion of reserves and resources following mining activities during the 2024 calendar year. Notably, no new exploration was undertaken during this period, resulting in no additions to the resource base.

Resource and Reserve Status

The total Ore Reserves now stand at 77.7 million wet tonnes, down by 5.5 million tonnes from the previous year, while the Mineral Resources have decreased to 114.4 million dry tonnes, a reduction of 4.3 million tonnes. These declines are solely attributed to mining depletion, with no conversions from resources to reserves or upgrades in resource classification reported.

The Bauxite Hills deposit continues to yield high-quality direct shipping ore (DSO) bauxite, characterised by alumina content around 49.8% and silica levels averaging 13.3%. The ore is suitable for high-temperature Bayer processing, underscoring its value in aluminium production, a metal critical to the global energy transition.

Operational and Geological Insights

The mine operates on the Weipa bauxite plateau in Queensland, with three main resource areas: BH1, BH2, and BH6, including former Gulf Alumina tenements. The deposit is flat-lying and tabular, with bauxite layers averaging 1.4 to 1.6 meters thick, overlain by a thin overburden. Sampling and drilling methods, including reverse circulation aircore, sonic, and vacuum drilling, have been rigorously applied over the years to ensure data quality and confidence in resource estimation.

Mining methods remain conventional, involving front-end loaders and dozers, with no blasting required. The company has incorporated learnings from ongoing operations into its resource and reserve modelling, ensuring realistic and economically viable estimates.

Capital Expansion and Market Position

Metro Mining plans a capital expansion totaling AUD 28.3 million to increase annual production capacity to 6 million tonnes. This investment includes acquiring a second floating crane, upgrading load-out facilities, and expanding mobile plant equipment. The expansion aims to meet growing market demand, particularly from China, which remains a significant consumer of bauxite.

Contracts for product sales are in place, with pricing assumptions informed by market analysis from CM Group. The company acknowledges that silica content in the product is expected to rise above current specifications post-2030, introducing some market uncertainty. However, marketing reports suggest the product will remain saleable, supported by Metro’s blend strategy and customer relationships.

Environmental and Social Considerations

Environmental approvals are secured, with an Environmental Impact Statement completed and granted in 2017. The mine respects several environmentally sensitive areas, which have been excluded from reserve estimates. Importantly, Metro Mining maintains productive agreements with the Traditional Owners of the land, reflecting a strong social license to operate. Indigenous employment and local economic contributions remain a point of pride for the company.