AusTin Mining has commenced owner mining at the Granville East tin mine in Australia, just over a week after liquidators were named to its previously appointed mining contractors, Jemrok Pty Ltd.

The decision to adopt owner mining as opposed to appointing another contractor was based on minimising disruption to the project by using existing equipment at site and employment of ex-Jemrok employees, the ASX-listed company said.

The company commenced tin mining at the Tasmania operation just last month.

AusTin Mining said: “The company considers owner mining will deliver greater control and improvement in mine productivity following a decline in productivity in early 2019.

“Under the owner mining model, waste mining operations have resumed following a period of lost production attributable to the collapse of Jemrok, and ore mining is expected to resume in the coming fortnight.”

Owner mining operating costs for Granville are estimated at A$100,000-A$130,000 ($70,655-$91,851) per month depending on blasting requirements and are inclusive of equipment rental, fuel and labour. “Owner mining should deliver a lower mining cost based on the removal of the contractor’s margin,” the company said.

Jemrok was previously contracted to also provide crushing and ore-haulage services but the company is now progressing discussions with a third party for these services. In the interim, AusTin has transported the relatively friable hangingwall ore that doesn’t require crushing to the processing plant for treatment.

This has, initially, led to an increase in plant feed grade but has necessitated a change in operating strategy to accommodate the increased level of sulphides associated with this material in order to achieve the targeted concentrate grade of 60% Sn.

“Upon implementation of contract crushing, the company will be able to increase the proportion of competent skarn ore that contains lower sulphide level and historically has been the predominant ore source for the project,” AusTin said.