Subject: First Quantum Minerals Provides an Update and Scoping Study
Results For The High Pressure Oxidation and Leach Project At The
Kansanshi Copper-Gold Mine
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Re: News Releases - Tuesday, January 10, 2006
First Quantum Minerals Provides an Update and Scoping Study
Results For The High Pressure Oxidation and Leach Project At The
Kansanshi Copper-Gold Mine
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(All figures expressed in US dollars)
First Quantum Minerals Ltd. ("First Quantum", TSX Symbol "FM", LSE
Symbol "FQM") is pleased to provide updated information and details of
a scoping study, dated December, 2005 by Bateman Engineering Pty Ltd.
("Bateman") of Mt. Pleasant, Western Australia on the High Pressure
Oxidation and Leach ("HPL") Project at First Quantum's 80% owned
Kansanshi copper-gold project in Zambia.
HPL PROJECT UPDATE
The main components of HPL project are the autoclaves, an oxygen plant
and an additional 35,000 tonne per annum solvent extraction and
electrowinning (SX/EW) facility. The main equipment for the autoclave
and oxygen plants has been successfully relocated from Turquoise Ridge
in Nevada, USA and all of the equipment is now either on site or in
transit to site, or undergoing refurbishment in South Africa. There
will be two autoclave vessels installed at Kansanshi as part of the HPL
project. One of the autoclaves is on site and has been installed on
its foundation, and the second autoclave is in Zambia and is expected
to arrive at Kansanshi by January 20, 2006.
Detailed design work for the HPL project has been completed, and
construction commenced in 2005. Site civil works for the project are
essentially complete, with only a small amount of civil work
outstanding for the oxygen plant. The majority of materials have been
preordered and are currently arriving on site. The structural, plate
work and mechanical installation associated with the new SX/EW plant
are well progressed, and are also underway for the autoclave and oxygen
plant areas. Piping and electrical installation for the project will
begin this month. Approximately 60% of the project capital has been
committed.
Construction of the HPL project is expected to be completed such that
pre-commissioning and commissioning will begin in the third quarter
2006.
BATEMAN HPL PROJECT SCOPING STUDY HIGHLIGHTS
- Project capital cost estimate of $72 million.
- Based on the acquisition of a second hand HPL facility (autoclaves,
oxygen plant and cooling tower), the HPL project could be commissioned
12 months ahead of the design and construction of a new HPL plant.
- The HPL facility under construction would be capable of treating
105,000 tonnes of copper concentrates per year. With expansion of the
oxygen plant, the two autoclaves would have the capacity to treat up to
200,000 tonnes of copper concentrate per year.
- Over a 5 year period, based on $1.36/lb copper in 2006, $1.20/lb
2007-2010 and $425/oz gold, an additional 67,000 tonnes of copper could
be produced for an aggregate increase in revenue of $195 million.
Furthermore it is anticipated that there would be a reduction of
existing operating costs in the sum of $77 million. This would result
in a total gross project benefit of $272 million, excluding project
capital.
- The HPL project would also produce acid that would meet a part of the
acid demand of the oxide leach circuit.
- In the mixed ore atmospheric leach circuit, copper leach extraction
could be improved by up to 30% depending on the proportion of
transition sulphide minerals in the mixed ores through the provision of
heated acid and ferric sulphate ions from the autoclave effluent.
Process Summary
The sulphide flotation concentrate treated by the autoclave will
contain a nominal 29% copper and 8 grams/tonne gold. The concentrate
is oxidised utilising two autoclaves and copper is recovered from the
autoclave effluent via the existing and expanded SX/EW circuits at
Kansanshi.
The HPL process results in near total oxidation of the copper sulphide
concentrate converting the sulphide sulphur to sulphates of copper and
iron. This additional sulphate will replace acid currently produced
for the atmospheric leach circuit, with one significant difference.
The autoclave can also provide a source of ferric sulphate that will
leach residual secondary copper sulphates not readily leachable by acid
alone in the current circuit design. Test work has shown that,
depending on the acid balance across the autoclaves, it is possible to
manipulate the extent to which the iron sulphates produced from
leaching chalcopyrite and pyrite in the autoclave can be hydrolysed to
a mix of haematite and basic ferric sulphate. The basic ferric
sulphate can then be re-leached to provide a source of ferric sulphate
for the oxide leach circuit. Basic ferric sulphate provides a source
of ferric ions for the atmospheric leach circuit to dissolve secondary
copper sulphides. The total pressure oxidation process also provides
significant waste heat that will be used to increase the atmospheric
leach temperature, improving copper leach kinetics and ultimately
increasing copper recovery levels.
No chloride or surfactants are required for this process.
Metallurgical Test Work
Metallurgical test work was undertaken on two composite samples
comprising oxide ore and mixed ore flotation tailings from across the
range of mineralogy that constitute the feed to the atmospheric
leaching circuit. This data was used during the scoping study to assess
the potential for recovery improvements that might be achieved in the
oxide leach circuit using solutions derived from the total oxidation
process. The two composites used were an oxide composite and a mixed
composite. It was expected that the oxide composite would show that
little advantage could be gained from the revised leaching conditions;
however the mixed composite was expected to show substantial
improvements in copper recovery.
Ammtec Limited, an Australian analytical, metallurgical and mineral
testing services company, undertook the test work under the direction
of Bateman/First Quantum based on a test work program prepared by
Bateman. Bateman used Metsim software modeling of the process to
identify the required leaching conditions.
Salient points identified from analysis of test results include:
1. Oxide composite:
- a small increase in copper recovery is identified, perhaps 2-3%,
largely as a result of the increased leach temperature; and
- the addition of ferric ions to the leach has not improved the leach
recovery as the minerals present do not require ferric ions to achieve
high copper recoveries.
2. Mixed ore composite:
- a substantially larger increase in copper recovery is identified, of
the order of 30%, largely as a result of the increased leach
temperature; and
- as a result of the addition of ferric ion to the leach; as the
secondary copper sulphide minerals do require ferric ions to achieve
high copper recoveries.
Capital and Operating Cost Summary
The capital cost estimate of $72 million is based on the engineering
design currently in progress, and has been estimated by Bateman, GRD
Minproc and First Quantum.
The operating cost estimate was prepared using reagent consumptions and
power calculations based on the final design criteria for HPL, mass
balances developed from the Metsim models, and input from First Quantum
including local labour rates, power costs, consumable costs in part,
and transport costs specific to the project site.
Consumable costs are based in part on Bateman's in house database and
in part on recent costs for reagents delivered to the Kansanshi mine
site. Maintenance costs have been factored from the capital costs of
each unit operation and appropriate proportions of that capital cost,
based on similar operations in operating plants.
The production rate from the HPL project is limited to that of two
autoclaves running at approximately 66% of maximum rated capacity in
the current design configuration; this limit is imposed by the capacity
of the oxygen plant. Engineering design has moved forward on the basis
that the autoclave systems will be designed for the maximum throughput
capability pending availability of additional oxygen.
Operating costs were determined for the major variable cost centers for
the process design currently being executed by Bateman and GRD Minproc.
In summary, over a 5 year period, based on $1.36/lb copper in 2006,
$1.20/lb 2007-2010 and $425/oz gold, an additional 67,000 tonnes of
copper could be produced for an aggregate increase in revenue of $195
million. Furthermore it is anticipated that there would be a reduction
of existing operating costs in the sum of $77 million. This would
result in a total gross project benefit of $272 million, excluding
project capital.
The HPL project as envisioned offers a significant revenue increase
derived from the additional copper production from the oxide leach
circuit afforded by the ferric production from the autoclaves, a
reduction in the requirement for acid production to meet oxide circuit
demand allowing excess production to be sold into the local market if
appropriate, and overall capital and time savings attendant on the
purchase of the second hand equipment.
Ken Baxter, Msc. Std., an engineer with more than 26 years of
experience, currently employed by the engineering and construction
company Bateman Engineering Pty Ltd in the capacity of Technical
Manager, Copper, supervised the design and conduct of the program, and
is the qualified person for the purposes of NI 43-101. The relevant
portion of the data disclosed in this new release has been reviewed and
verified (including relevant analytical and test data) by Mr. Baxter.
On Behalf of the Board of Directors 12g3-2b-82-4461
of First Quantum Minerals Ltd. Listed in Standard and Poor's
"G. Clive Newall" Sedar Profile #00006237
G. Clive Newall
President |
