Since this is the second time co. mentioned Andacollo, few releases from Canada Tungsten(merged with Aur)about this project for comparison:
1/Canada Tungsten Inc.
CTG
Shares issued 29,839,539
1993-08-20 close $1.5
Friday Aug 20 1993
Mr. Wayne Lenton reports
Empresa Nacional de Mineria (ENAMI), a Chilean state owned mining company,
has awarded the company an option to purchase and develop the Andacollo
copper project, located in central Chile. Subject to confirmation of technical
details during a 15 month evaluation period, the company will acquire 90% of the
interest in the property from ENAMI for US$5.5 million in staged payments.
ENAMI retains a nominal 10% carried interest.
The company plans to develop the Andacollo deposit in conjunction with
Compania Minera del Pacifico (CMP), a large Chilean mining company with
substantial mining operations in the vicinity of Andacollo. A joint development
agreement in principle has been reached whereby the company and CMP will
develop the project on a 70% Canada Tungsten/30% CMP ownership basis. As
part of the development plan, the company has included provisions for local
business opportunities for Andacollo entrepreneurs as well as local training for the
company' future project employees.
Previous exploration drilling on the property has outlined a preliminary mineable
reserve of 39 million tonnes grading 0.94% copper in an enriched blanket of
secondary mineralization. The mineable reserve overlays a much larger porphyry
deposit estimated to contain 280 million tonnes grading 0.57% copper and 0.165
grams of gold per tonne.
Initial metallurgical testing indicates that mineable reserves are amenable to
sulphuric acid leaching using solvent extraction-electrowinning technology. At an
estimated capital cost of US$50.0 million, the company plans to develop a low
cost open pit, heap leach copper operation delivering 2.5 million tonnes of ore per
year to an SX-EW facility which will produce 37 million pounds of high grade
copper cathodes each year. Total production costs are estimated at less than
US$0.55/lb of copper. Startup is planned for 1996. The mine life of the leachable
ore is estimated to be at least 15 years.
A study will be undertaken to identify a process which will allow later
development of the 280 million tonne primary sulphide porphyry deposit.
The Andacollo copper project is located 350km north of Santiago near the port
cities of La Serena and Coquimbo at an elevation of 1,000 metres. The proximity
of these major centres plus the ready availability of inexpensive electricity and
sulphuric acid will aid substantially to a low cost operation at Andacollo.
2/Canada Tungsten Inc
CTG
Shares issued 29,839,539
1994-01-26 close $1.69
Wednesday Jan 26 1994
Mr Wayne Lenton reports
The company has successfully completed the diamond drilling program of 50 holes
(3,697 metres) on the Andacollo copper project in central Chile. The holes were
drilled to provide metallurgical test samples and were to confirm previous
intersections of the secondary enriched blanket of copper mineralization overlying
the primary porphyry deposit. The 50 holes returned 59 intercepts averaging 12.7
metres in thickness and 0.95% leachable copper. Representative metallurgical test
samples of each of four rock types totalling 4,000 kg have been shipped to a
testing laboratory in the United States for comprehensive column leach testing
using bacterial/sulphuric acid leaching.
A new ore reserve block model is being developed for a pit plan to be included in
the feasibility study scheduled for completion in the third quarter of 1994.
Preliminary results of testwork to date confirm the viability of the project using an
SX-EW copper plant to produce approximately 37 million pounds of high grade
copper cathode per year. The estimated capital cost, including working capital for
the project is US$50 million. The cash operating cost is estimated at
approximately US$0.50/lb copper.
CTI plans to develop the Andacollo copper project with Compania Minera del
Pacifico (CMP) of La Serena, Chile on a shared 70% CTI/30% CMP interest
basis, with a government owned company, Empresa Nacional de Mineria
(ENAMI) retaining a carried 10% interest after payback of capital and other
items.
As at December 31 1993, CTI has net working capital of $18.0 million.
3/Positive feasibility study for the Chilean Andacollo copper
project
Canada Tungsten Inc
CTG
Shares issued 29,839,539
1994-11-22 close $1.75
Tuesday Nov 22 1994
Dr James Gill reports
The board of directors of Canada Tungsten (CTI) has determined, on the basis of
the positive feasibility study for the Andacollo copper project in Chile, that CTI
will exercise its option to acquire the project from Empresa Nacional de Mineria
(ENAMI), a Chilean government entity. A US$0.5 million cash payment will be
made to ENAMI upon exercising the option and additional payments totalling
US$4.0 million must be made over the subsequent ten year period. Development
of the Andacollo deposit for production is, subject to financing, expected to begin
in early 1995 leading to initial copper production in the second half of 1996. The
Andacollo copper project will be owned 70% by CTI and 30% by Compania
Minera del Pacifico (CMP), with ENAMI retaining the equivalent of a 10% net
profit interest after payback.
The feasibility study, which was managed by MinCorp Engineers and
Constructors of Englewood, Colorado, provides for the production of
approximately 44 million pounds of copper annually over an eleven year mine life
based upon a mineable ore reserve of 34.6 million tonnes at an average total
copper grade of 0.87% copper. The reserves in the mine plan are comprised of
oxide and supergene sulphide material which will be mined by open pit methods.
Copper is to be recovered by the solvent extraction electrowinning process
(SX-EW) to produce cathode copper with metallurgical recoveries forecast at
75% of total copper.
Revenues over the eleven year mine life, at US$1.00 per pound of copper, are
projected at US$484 million. Cash operation costs over the life of the mine are
expected to average US$0.54 per pound of copper, with lower unit costs to be
achieved in the early years of production when higher than average grade ore will
be mined. Capital costs to fully develop the Andacollo mine are estimated at
US$68.9 million.
A financial analysis of the project indicates that it has a net present value, at a
discount rate of 8%, of US$35 million assuming 1.00% equity financing and no
repatriation of cash flow, after payback, outside of Chile. Payback of the capital
investment is expected to be achieved in less than four years on this basis. The
economics of the Andacollo project are favourable with an indicated internal rate
of return of approximately 20% on a full equity basis.
The Andacollo copper deposit is expected to be a highly profitable mining
operation for CTI, CMP and ENAMI. The potential for extending mine life,
through the development of the 240 million tonne porphyry copper sulphide
deposit, which underlies the oxide and supergene sulphides to be mined in the
current plan, is believed to be high as is the potential for the discovery of both new
gold and copper reserves elsewhere on the property.
(c) Copyright 1998 Canjex Publishing Ltd. canada-stockwatch.com
*Copper now per lb/0.74
Estimated cash operation costs were approx.US$12 per tonne |
