Tuesday, June 14, 2011

Xstrata Copper to Start Lomas Bayas Sulphides Project Prefeasibility Study

Santiago, 13 June 2011
Xstrata Copper’s Executive Committee has approved the start of a prefeasibility study to evaluate the development of the copper sulphide deposit located below the current pit of the Lomas Bayas operation in northern Chile’s Antofagasta Region. The approval follows the Committee’s review of the recommendations of the concept study carried out over the last two years.
The new study will assess a possible investment of US$1.6 billion to expand annual production to 140,000 tonnes of copper in the form of concentrates and cathodes and to extend the life of the Lomas Bayas operation to 2039. It is expected that the prefeasibility study, which will comprise new drilling, metallurgical tests and geomechanical studies, will be completed at the end of 2012.
Subject to positive feasibility studies and government and company approvals, it is estimated that the Lomas Bayas sulphide project could start production in 2017. The project considers a concentrator plant with a processing capacity of 70,000 tonnes per day and the use of seawater for its operation.
Lomas Bayas General Manager Luis Rosales said: “The approval to advance to the next stage in studies of the Lomas Bayas sulphide project is a further example of Xstrata Copper’s strategy to increase the value of our operations through extensions to mine lives and brownfield expansions. The project forms an important part of the growth plans that Xstrata Copper has in Chile”.
“The Lomas Bayas sulphide project will allow us to sustain the operation over the long-term and thereby continue to contribute to the development of the region and of the country, benefitting both the company and our employees, communities and suppliers,” added Rosales.
The prefeasibility study will allow Lomas Bayas to optimise mine and production plans, estimate costs more precisely and advance towards the feasibility stage. In addition, the study will assess synergies and scale economies with the Lomas Bayas II project which is currently under construction and will extend the operation’s useful life by more than ten years to 2023 at the current production rate of 75,000 tonnes per annum.
In December 2010, Xstrata Copper announced an upgraded mineral resource estimate for the Lomas Bayas sulphide project, based on 121 drill holes (50,410 metres). The improved estimate totals 435 million tonnes at an average grade of 0.39% copper, using a 0.2% copper cut-off grade, and includes molybdenum, gold and silver credits.
Associated with the potential sulphide pit, there are also 408 million tonnes of leachable oxide and mixed mineral resources with an average grade of 0.26% copper.


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