Xstrata Copper: Decision on El Pachón in coming weeks - Argentina
bnamericas.com
Published: Thursday, April 10, 2008 14:01 (GMT -0400)
By Laura Superneau Business News Americas
Red metal giant Xstrata Copper is wrapping up the prefeasibility study for its El Pachón project in Argentina's San Juan province and expects to decide in the coming weeks on how to proceed, company CEO Charlie Sartain said Thursday.
"We must make a decision on whether or not to dive into the next phase, feasibility," Sartain told reporters at the CRU 7th World Copper Conference in Santiago, Chile.
Xstrata Copper is the red metal division of Switzerland-based Xstrata plc (LSE: XTA).
Sartain added that his company is in talks with the Argentine government regarding the export tax announced late last year of 5% on precious metals and 10% on base metals. The tax has perturbed many miners in the country, particularly those that, like Xstrata, held long-term tax stability contracts with the government.
"What we want is a stable environment for large investments in megaprojects like El Pachón. Fundamentally, what we need is for the Argentine government, like other governments in the region, to take on a responsible policy in terms of its own fiscal stability," said the CEO.
Xstrata as a company has been present in Argentina for some 14 years and probably has more experience operating there than any other big miner in the world, he said. "We want to use all the experience, the relationship we have with the government, to develop our business [in Argentina] even more. That is what we want to do," Sartain said when asked whether the lack of stability could be a reason to leave the country.
Conceptual studies completed in 2005 estimated capital costs of US$1.2bn to build a 100,000t/d open pit mine at El Pachón with conventional milling and flotation processing, while Argentina's mining ministry last year estimated investment at US$1.9bn. Xstrata acquired the mine in 2006 with its takeover of Canada's Falconbridge.
The company also has a 50% controlling stake in the Alumbrera copper-gold mine in nearby Catamarca province, plus numerous operations in Chile and Peru. |
