South32’s Hermosa Project Achieves Key Operational Milestones

Permitting is on the FAST-41 track and exploration continues to further define the orebody

South32’s Hermosa project announced a series of project developments that highlights its commitment to investing in and partnering with the community to bolster workforce development and community health transparency. This includes the formation of the South32 Hermosa Workforce Development Taskforce, the hiring of public health experts to guide the Santa Cruz County community health assessment and outreach to local public health institutions, and a construction update on the main exploration shaft.

“We are designing the Hermosa project with state-of-the-art technology to be a safer, more sustainable, and more advanced mine,” said Hermosa Project President Pat Risner. “We are excited to share our progress as we work to reduce America’s reliance on foreign countries for critical minerals, while unlocking new economic opportunities for this community.”

FAST-41 Designation

South32 has been active in southern Arizona for more than five years now, Risner explained. “We are proud of what we have achieved in this short amount of time as we continue designing the Hermosa project to be a mine that’s safer and more sustainable than anything Arizonans have seen,” he said. “Hermosa will also reduce America’s reliance on foreign countries for the resources found at our site and strengthen our domestic supply of manganese and zinc – both designated critical minerals.”

To operate, Hermosa needs a series of state and federal permits. In May 2023, South32 Hermosa was the first critical minerals project to be designated as a FAST-41 project.

FAST-41’s “FAST” acronym stands for “Fixing America’s Surface Transportation,” the name of the bill that created the Federal Permitting Improvement Steering Council (FPISC), an independent federal agency responsible for environmental reviews and permitting for infrastructure projects.

In July 2023, the FPISC published a proposed comprehensive, integrated permitting timetable for South32’s Hermosa project. It includes intermediate and final completion dates for all federal environmental reviews and authorizations for full project development, as well as a list of cooperating agencies. The proposed permitting timetable projects Hermosa will happen in three phases.

Because FAST-41 at the outset will make the rigorous federal environmental review and permitting process for this project more transparent, predictable, and inclusive for all stakeholders, South32 is well positioned to bring this project into operation in a way that benefits the community, minimizes impact on the environment, and creates new opportunities across the region in the years to come, Risner explained.

“We are looking forward to 2024 as a year in which we will complete our feasibility studies, continue our construction process and develop a homegrown workforce with the next-generation skills needed to operate the Hermosa project and support our broader community for generations to come,” Risner said.

Continuing Project Construction

In May, the Hermosa project began initial excavation for the main exploration shaft and the ventilation shaft to provide underground access to the Taylor deposit.

During December 2023, Hermosa announced that construction pre-sink activities of both shafts remain on track. To date, we have excavated 50 of the planned 115 feet for the main exploration shaft and excavated 115 feet for a ventilation shaft. While total depth of the shafts is approximately 2,900 feet, achieving these construction milestones will allow for infrastructure needed for safe passage of people and vehicles underground.

“This construction demonstrates the continued progress of the Hermosa project toward delivering critical minerals to the market which would reduce America’s reliance on foreign countries and strengthen domestic supply of critical minerals. This advanced, underground mining method enables reduced surface impact and the amount of tailings resulting in a more sustainable mine,” said Hermosa project Vice President of Project Delivery Andy Thompson.

Supporting Workforce Development

The main purpose of the South32 Hermosa Workforce Development Taskforce is to identify the skills needed and local facilities available to help train, develop and expand the region’s workforce.

“The first step in helping transform the local economy is partnering with community members whose expertise and understanding of our region’s educational needs can help create opportunities, so that the next generation can stay in Santa Cruz County,” said South32 Human Resources Director for North America Skylie Estep. “This partnership will allow us to develop a clear, specific pathway for training local residents to fill the high-skilled, good-paying jobs Hermosa will bring to the region.”

The taskforce will begin meeting in 2024. Confirmed members include: 

• Angelina Canto, Nogales Unified School District # 1 Superintendent;

• Victoria Clark, Business Development Director, Pima Community College;

• Skylie Estep, South32 Human Resources Director for North America;

• Manuel Felix, AZ Cyber Initiative;

• Naiz Garibay, South32 Project Supporter Coordinator;

• Patrick Garretson, South32 Study Manager;

• Kenny Hayes, Patagonia Public Schools Superintendent;

• Greg Lucero, Santa Cruz County Workforce Development Steering Committee;

• Kari Middleton, Pima Community College;

• Sandra Moraga, South32 Communities Specialist;

• Stephanie Moreno, South32 Tribal Affairs Specialist;

• Akmaral Muken, South32 Training and Learning Principal;

• Irasema Olvera, Arizona @ Work;

• Josh Rubin, Greater Nogales Santa Cruz County Port Authority;

• David Verdugo, Santa Cruz Valley Unified School District No. 35 Superintendent; and

• Chris Young, Chief Deputy Santa Cruz County School Superintendent’s Office.

Setting a New Standard for Safety and Sustainability

The Hermosa project has hired Ramboll, a global consulting firm with decades of experience conducting community health assessments in southern Arizona and across the United States, to guide South32’s Santa Cruz County baseline community health assessment and outreach to local public health institutions, including the University of Arizona.

A baseline assessment will help Hermosa limit the exposure of manganese and other minerals. By understanding what already exists in the community and environment before operations begin, South32 can make sure health and safety controls are in place, better understand any changes over time, and ensure controls remain effective throughout the life of Hermosa.

“We know our families, friends and neighbors are counting on us to get this right,” said Hermosa Project Communities Principal Melanie Lawson. “That’s why we are partnering with third-party public health organizations to regularly monitor and report findings to ensure transparency and accountability.”

Two professionals will lead Ramboll’s efforts at the Hermosa project: Rosalind Schoof, Ph.D., Diplomate of the American Board of Toxicology (DABT), Fellow ATS, and Alma Feldpausch, MS, DABT.

Updated Mineral Resource Estimate

In July 2023, South32 updated the mineral resource estimate for the Hermosa project, which includes the Taylor zinc-lead-silver deposit, the Clark battery-grade manganese deposit, and the Peake deposit.

The Taylor Mineral resource estimate is estimated at 153 million metric tons (mt), averaging 3.53% zinc, 3.83% lead and 77 g/mt silver. The upgrade includes a 41% increase in the measured mineral resource estimate, providing a compelling base to underpin future production. The deposit remains open in several directions, offering the potential for further growth. This zinc resource in the Taylor deposit would be one of the world’s largest undeveloped resources, which is also a federally designated critical mineral in the USA.

South32 also published information on the Peake deposit, which is a copper-lead-zinc-silver prospect, a lateral zone prospective for copper mineralization, located south of the Taylor deposit.

The results included the best intercept at Peake to date, with diamond drill hole HDS-813 returning a downhole intersection of 139 m grading 1.88% copper, 0.51% lead, 0.34% zinc and 52g/mt silver at 2.49% copper equivalent (CuEq), including 58.2 m grading 3.1% copper, 0.6% lead, 0.24% zinc, 74g/mt silver and 0.015% molybdenum at 3.84% CuEq.

These days a grade above 1% would be considered rich and South32 said it is planning further exploration drilling at Peake in 2024.