US to speed up South32’s Hermosa manganese-zinc project

The Hermosa manganese and zinc project in Southern Arizona. (Image courtesy of South32.)

South32’s (ASX, LON: S32) Hermosa manganese and zinc project has become the first mining asset added to the FAST-41 process, US government legislation aimed at promoting faster development of clean energy assets and other infrastructure.

Located in a historic mining district in the Patagonia Mountains of southern Arizona, the project is the only advanced mine development project in the US as of 2023 that can produce two federally designated critical minerals, South 32 says.

“The inclusion of Hermosa as the first mining project added to the FAST-41 process is an important milestone that recognizes the project’s potential to strengthen the domestic supply of critical minerals in the US,” South32 chief executive officer Graham Kerr said in a statement.

Construction and mine development at Hermosa, made up of the Taylor and Clark deposits, can now start with approvals from the State of Arizona, the company said.

South32 expects to complete the feasibility study for the Taylor zinc-lead-silver deposit in the second half of this year, as it undertakes additional engineering studies to align the mine development schedule for a federal permitting process and include current market cost estimates.

The current phase of study work for Hermosa’s Clark deposit has confirmed its potential to supply battery-grade manganese to US electric vehicle supply chain, the miner said. 

“Becoming a covered FAST-41 project will make the rigorous federal environmental review and permitting process for this project more transparent, predictable, and inclusive for all stakeholders,” South32 Hermosa President Pat Risner said.

South Africa, Gabon and Australia account for more than two-thirds of production of manganese, mainly used in the steel sector. Domestic output in the US — which once had mines in states including Virginia — ended in the 1970s. 

Fastest growth rate

Demand for manganese from the battery sector is set to surge ninefold by 2030, the fastest growth rate of any of the industry’s key metals, according to BloombergNEF

Prospects for production in the US, which currently is 100% reliant on foreign sources for manganese, are also being boosted by efforts to reduce supply chain reliance on China under President Joe Biden’s Inflation Reduction Act, enacted last year.

US Senator for Arizona Kyrsten Sinema noted she expected the project to strengthen the state’s position in the responsible production of critical minerals and renewable energy.

The FAST-41 legislation establishes new procedures that standardize interagency consultation and coordination during the permitting process.

(With files from Bloomberg)