Tennant Mines and its South African investor plan decades long partnership
A cross-continental brochure drop led to tens-of-millions of dollars worth of investment in the NT’s fifth largest town. Read how.
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The rebirth of large scale goldmining in the Barkly began with another failed attempt to revive extraction in the region.
When Hong Kong-based TransAsia’s Tennant Creek revival prospect hit hard times, directors contacted experienced Western Australian mining executive Peter Main to develop a model for a serious, sustainable revival of the district’s gold industry.
Junior miners had been faffing around the Barkly for decades, well before the district’s last operating gold mine, Chariot, was shuttered by Giants Reef in 2005.
While their intent and ambition was unquestionable, the thread that united these common failures was scale – or the lack thereof.
Backed by $10 million from TransAsia, Peter and his colleagues began putting together the structure of a company that began with the $7 million acquisition of three of the Barkly’s four biggest assets – Juno, Nobles Nob and Warrego.
This put the consolidated into Tennant Consolidated Mining Group Pty Ltd, trading as Tennant Mining, the company’s start-up name.
Fundraising during a global pandemic was a challenge, but buoyed by a $30 million private equity investment by Tembo Capital and with momentum building, Mr Main organised a public meeting with the Barkly community, where they were “beaten up” by a sceptical crowd who’d had a gutful of mining revival stories.
“We then flew the project under the radar because there was a history where so many companies had failed before us,” he said.
“We just went about it quietly and we didn’t come back until we knew what we could do.”
Tennant Mining then paid $4.2 million to buy the disused Eldorado Motor Inn for worker accommodation.
Even with the more than $2 million spent on upgrades, this came in less than half it would have cost to build a workers camp at Nobles.
“It’s been the best investment I think we made because it integrated us into the community,” Mr Main said.
“The community has been our primary focus right from day one. By moving into town, we’ve really been accepted in the Barkly because we’ve not gone out there making a lot of noise, we’ve just got on with it.”
In late 2023, the project secured a $10 million loan from the NT Government’s Local Jobs Fund.
On the back of that, Mr Maim and his team set out to secure the remaining $50 million required to get a project out of the ground.
“The Local Jobs Fund was really a cornerstone that came in when we couldn’t get funding,” he said of the previous Labor Government’s signature economic initiative.
“It funded us for $10 million and that was significant because it added a lot of kudos.
“On the back of that we went and saw about 35 groups and one, Keyview Financial Group, funded us for $37 million, which gave us the debt financing gap we needed.”
Enter Pan African Resources, a mid-tier Johannesburg-London listed mid-tier player with four South African mines, a shuttered Sudanese prospect and a total workforce of about 7000.
Pan African’s initial minority equity investment in March 2024 enabled the project to achieve bankable feasibility and for construction to commence.
In December 2024, Pan African paid $77.4 million to become the Tennant Mining’s 100 per cent shareholder.
In Jo’burg, also known as the City of Gold, a “brochure” had arrived in late 2023 from TCMG pitching the project.
Hendrik Pretorius, Pan African’s technical services and new business executive who was in Tennant Creek for last week’s opening, said the contact piqued the company’s interest.
“What stood out for us was that you’ve got near surface ore bodies, grading about three grams per ton, mineral resource about one-million ounces and part and parcel of the foundation for that resource is a ground-filled stockpile of 1.3 million tons at one-and-a-half grams per ton,” he said.
“That’s broken material stockpiled from historical mines sitting right on the surface. We started a 12-month due diligence process in December 2023 which included a run-through feasibility study that upgraded mineral resources to mineral reserves, and we ended up with about 400,000 ounces and at least eight year life-of-mine.
“Initial modelling showed plenty of expansion opportunities and exploration prospectivity.
“Tennant Consolidated worked hard at obtaining a second-hand gold plant from Cloncurry for $1 million Aussie dollars and we announced our involvement in December 2024. It’s our first mine out of Africa and we couldn’t be more excited.”
Reflecting on finding Tennant Mines’ golden needle in the vast Australian haystack, Hendrik said their relative sizes helped seal the deal.
“Pan African operates in that middle sort of ground, larger than junior miners, but smaller than the majors, so a project like this is not on the radar of the larger companies,” he said.
“I think over the last 20 years the Barkly was deprived of a healthy exploration budget.
“We’ll actively explore this area and we’ve got a $15 million budget for the next 12 months to do exploration.
“We just finalised a magnetic inversion model which highlighted that a lot of these deposits have deep roots and seem to be connected quite deep, over a kilometre deep, and we comfortably mine up to two and a half kilometres currently, so we’re not afraid of going underground or going deep.”
From an eight-year life of mine, Mr Main is now talking up to 30 years as gold and copper production respond to market demand.
Pan African Resources’ investment has added a layer of confidence around the project. Tennant Consolidated Mining Group has rebranded its trading name as Tennant Mines in Pan African’s colours to commemorate the start of commercial production.
With first sales of processed gold from Nobles expected in the next month, the company is also hoping to activate its stage two copper mine at Warrego mine over about two years.
Mr Main said Tennant Mines’ story showed project scale would trump small-time every time.
“I don’t think it will open up a gold rush,” he said.
“As much as this is a high-grade field, I don’t think there’s room here for 10 companies because the field is difficult. The ore bodies are very small, but they’re much higher grade than anywhere else in the country.
“You need deep pockets and you need a Pan African Resources that has the money and can spend the money.
“It’s not for juniors, and we were one of them, but you just don’t have the balance sheet and the capital that’s required.”
When the project was launched in 2020, it was independently tested and validated as being profitable with the gold price of $2250 an ounce.
The spot price today is about $5150.
And over the past 12-months, Tennant Mines and joint venture partner Emerson have identified an additional 600,000 ounces in gold resources at the abandoned White Devil mine, which adds to the feasibility of a decade long operation.
And on the gold price, Mr Main is confident it will hold up in coming years due to the volatile global geopolitical and economic environment.
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Originally published as Tennant Mines and its South African investor plan decades long partnership
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