Metminco Announces Mollacas Ruling on Access Rights
Mar 27 14
Metminco Limited. announced that the Court of Appeal of the IV Region, Chile, has ruled that the company's First Easement Extension, granted by the Judge in the Third Court of Ovalle on 11 November 2011, which allows the company to engage in mining activities, is invalid and void on technical grounds. The technicality relates to the Judge having approved the First Extension over property not owned by the defendant (although they are related parties), and a change in the area and purpose from that of the Original Easement. The IV Region Court of Appeal also confirmed that the Original Easement (Servidumbre) permitting access to the company's Mollacas Copper Project (viz. exploration and exploitation concessions), granted in 2004 by the First Court of Ovalle, remains current and in full force and effect. As such, the company will continue with the conduct of the planned Feasibility Study and the Environmental Impact Study, as announced previously. The decision of the IV Region Court of Appeal is subject to appeal. The company intends to vigorously challenge the judgement of the IV Region Court of Appeal with respect to the First Extension, and will lodge an appeal to the Supreme Court of Chile in Santiago no later than 3rd April 2014, since the company believes that the ruling of the IV Region Court of Appeal is not consistent with the current Mining Legislation in Chile that allows for the extension of an easement.
Metminco Limited. Announces the Results of the Metallurgical Testwork and Financial Modeling for the Mollacas Project
Mar 19 14
Metminco Limited. announced the results of the recently completed metallurgical testwork and financial modeling for the Mollacas Project, the latter of which demonstrates the robust nature of the economics for the Mollacas Project. The financial model incorporates the results of a pit optimisation study completed by Metminco in 2013, updated contract mining rates and revised processing costs. Capital costs are based on a prior Scoping Study completed in 2008, adjusted for the revised production profile. Based on the positive economics for the project, the decision has been made to proceed with a Feasibility Study (FS) and Environmental Impact Study (EIS), which are expected to be completed by late 2014. The Mollacas Project ("the Project") is located in the IV Region, Chile, at an altitude of 1,200 to 1,500 metres above sea level. It is situated approximately 65 km east of the city of Ovalle near the small settlements of Valdivia and Las Mollacas, and can be accessed from Ovalle via 53 km of asphalt road to the town of Rapel, and then by 12 km of a well-maintained dirt road east of Rapel. The company holds title to 20 Exploitation Licences covering the Mollacas deposit and surrounding area, as well as 179 ha of surface rights adjacent to the proposed open pit operation. The infrastructure for the mine will be located on Company owned land including the leach pads, processing plant, administration facilities and mine workshops. Metminco also owns water rights to approximately 175 litres/sec from two canals which traverse the properties. The estimated water usage for the operation will be 40 litres/sec. The company recently updated the original Scoping Study of 2008 to incorporate the results of the pit optimisation study completed by the company in 2013, as well as the updated mining and processing costs, which provide for contract mining and the results of the recent metallurgical testwork. Capital cost estimates were adjusted for the revised production profile, and the use of mining contractors. The pit optimisation resulted in a provisional production profile comprising 14.5 million tonnes at 0.52% CuT (0.42% CuSol) over the life of the pit, with an in-situ soluble copper content of 60,753 tonnes. Metallurgy, the primary leach design parameters resulting from the recent metallurgical testwork have been incorporated into an updated Life of Mine production schedule. When compared to the original Scoping Study, it is clear that the reduction in acid consumption rates per tonne of ore leached derived from the testwork has more than offset the higher prevailing acid price and increase in power costs in Chile. The primary leach design parameters resulting from the recently completed metallurgical testwork are Ore crush size: P80 12 mm to 16 mm; agglomeration acid addition: 10 kg/t (may be reduced after further testing); stacked ore depth: 6 metres; stacked dry-bulk density (maximum): 1.7 t/m³; A two-stage leach: i) 90-day Primary Leach Stage @ 5 L/hm² at 6 g/L H2SO4; and 210-day Secondary Leach Stage @ 2.5 L/hm² at 3 g/L H2SO4. Solution Management Scheme: The staged leach and acid concentration values can be met with a series/parallel SX configuration, where the Primary Leach PLS feeds the two in series SX extraction stages, and the Secondary Leach PLS feeds the parallel extraction stage. Additional column leach testwork has been initiated to determine the lowermost limit of acid addition in the agglomeration stage with the objective of ascertaining whether acid consumption can be reduced further. At a mining rate of 6,108 tonnes per day, the Project has a Life of Mine of some 7 years producing up to 8,000 tonnes of cathode copper per annum. Capital costs for the Life of Mine, including sustaining capital and an allowance for the purchase of further surface title, is estimated to be USD 52.3 million. The results of the Life of Mine Financial Model are summarised in Table 3 below, and support the robust nature of the economics for the Project, and hence the decision to progress with the development of the Project. The Los Calatos Project, located in southern Peru, has an open pittable Mineral Resource of 493 million tonnes at 0.38% Cu and 0.023% Mo (at cut-off grade of 0.15% CuEq) to a vertical depth of 700 metres below surface and an underground bulk mining Mineral Resource of 926 million tonnes at 0.51% Cu and 0.022% Mo (at a cut-off grade of 0.35% CuEq) commencing at an elevation of 2,300 metres (approximately 700 metres below surface). The Chilean assets include the Mollacas Copper Project with a Mineral Resource of 15.5 million tonnes consisting of a Measured Resource of 11.2 million tonnes at 0. 55% Cu and 0.12g/t Au and an Indicated Resource of 4.3 million tonnes at 0.41% Cu and 0.14g/t Au(at a 0.2% copper cut-off); and the Vallecillo Project with a Mineral Resource of 8.9 million tonnes consisting of a Measured Resource of 5.5 million tonnes at 0.84g/t Au, 9.99g/t Ag, 1.12% Zn and 0.32% Pb, an Indicated Resource of 2.6 million tonnes at 0.80g/t Au, 10.23g/t Ag, 0.94% Zn and 0.35% Pb and an Inferred Resource of 0.8 million tonnes at 0.50g/t Au, 8.62g/t Ag, 0.48% Zn and 0.17% Pb (at a cut-off grade of 0.2g/t Au).