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Gold/Mining/Energy : Peruvian Gold Ltd. PVO
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To: charred who wrote (591)8/30/1998 6:14:00 PM
From: E. Charters  Read Replies (1) of 892
 
Well I hate to a feasibility before the reports are in. If you had oxide then maybe all you need is ~15 million tons of 1%!. (near surface of course) But sulfide needs usually 400 million to 1 billion tons. Grade does not need to be that high if you have electricity. Peru has a good grid and cost are reasonable. BC can mine .30 % copper with no gold all at 40 thousand tons per day due to its low power costs and good infrastructure and closeness to markets and smelters. The key is what your costs are and the closeness to markets and transportation. Chalcocite can be concentrated and pressure leached too because of its high grade. Its concentrates are extremely high grade (+50% Cu) and can afford treatment. The McIntyre mine mined 10 million tons of 1% chalcocite underground and made money. Don't forget that a major copper mine in Butte Montana at .50 percent copper operated underground at 80,000 tons per day and made money for many years.

Many of the companies that are exploring overseas do not have engineering or development teams who can crunch costs and market conditions in any realistic manner. A lot of these deep high grade zones I would consider doing at really large scale as vertical crater retreat or block caving underground operations. They could be mined with 45 and 80 ton trucks at 25 to 100 thousand tons per day and leave the leach cap in place. (with pillars every 200 feet!) At 25 K tons per day our Lara deposit could be mined at an ore removal and concentration cost of perhaps 8 dollars CDN per ton. It needs a grade of .40% copper and price of .80 US to be profitable. If it can be done for 180 million then the profit is about 250 million in 14 years for a rough ROR of 15%. That is vastly better than bank interest.

The probability is that the prices in the future will allow a much better profit than that.

Will such small porphyries be tackled? I really don't think so by a junior. It is really hard to compete in copper unless you have a smelter or an oxide deposit. The majors are more attracted to the larger deposits for obvious reasons. So straight economic possibilities are not always the answer. There are 5% copper deposits of large size in the Wrangell range in Alaska and BC. The thinking is they will sit there forever.

mailto:echarter@vianet.on.ca
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