Yamana Brazil to sell gold, copper to India, Europe
Fri Aug 11, 2006 9:42pm ET
yahoo.reuters.com
Yamana Gold Inc (YRI.TO: Quote, Profile, Research) will sell gold and copper concentrates from its new Chapada mine in Brazil to one Indian and two European smelters, Yamana president Peter Marrone told Reuters late on Friday.
"We will sell concentrates to India's Hindalco and Spain's Atlantic Copper," Marrone said in a telephone interview. "We are also negotiating sales from Chapada to another European smelter," he said.
The treatment and refining costs for the concentrates will be established on an annual basis with the smelters in line with market practice, he said.
Construction of Chapada mine, in Goias state, central Brazil, is 92 percent complete, and Marrone expected production start-up in late September, with first deliveries by November.
The $220 million Chapada mine represents a first move into copper for Canada's Yamana, an medium-size gold producer with four producing gold mines in Brazil and one in Honduras.
"But we're not looking for new copper properties," Marrone said. "Copper revenues will represent less than 25 percent of Yamana's total revenues."
Yamana achieved revenues of $41.9 million in the second quarter of 2006 on gold production of 83,089 ounces (oz), according to financial results published on Aug. 9.
Chapada will produce ore containing 19,000 oz gold and 15 million pounds of copper by the end of 2006. This will rise to 180,000 oz gold and 140 million lb of copper contained in concentrates in 2007, Marrone said.
"Chapada will have a total mine life of 19 years, during which time it should produce 2 billion pounds copper and 1.5 million oz gold," the official said. Its highest production levels will be during the first five years, when it will produce half its total gold output and a third of its copper.
Marrone added that smelter treatment and refining charges are at an all-time low, of around $25 per tonne of concentrates or 2.5 US cents per pound of copper.
"This favours the mines, which have to pay the charges. We are entering the copper market at an excellent time," he said.
The low treatment charges have persisted due to continuing short supply worldwide of copper in the form of concentrates, Marrone said. "The smelters need concentrates," he said. |
