The Company expects each of these project elements, individually and as a group, are expected to result in substantial reductions to the cash costs per payable pound of copper over the life of the project and therefore contribute to realizing a value of the Aranzazu asset greater than that stated in the PEA because of the increase in capacity from 4,000 to 4,500 tpd."
Additional Project Commentary
The measured, indicated and inferred mineral resources as of September 30, 2011, and included in the PEA, have not been updated.
The underground mine has been designed to facilitate the extraction of 4,500 tpd through the application of transverse long hole open stoping, a low-cost bulk mining technique suitable for the significant mineralized mining width and strong continuity of Aranzazu resources. Paste backfill is integral to the project to maximize both resource recovery and mining productivity. Modern trackless mobile equipment will be used for the majority of mining activities.
An extensive underground development program that attains a minimum of 700 meters per month of advance is being executed to develop and maintain access to adequate resources to sustain 4,500 tpd of production. Underground project infrastructure include ventilation shafts and fans, a centralized pumping station, a modern maintenance facility, electrical substations, fueling facility and other ancillary installations.
Material handling from the underground workings to the concentrator is accomplished by a modern fleet of haulage trucks via an extensive ramp system connected to two existing surface portals. Primary crushing will continue to be performed on surface.
The Company expects the planned underground infrastructure and mining method support a potential increase in production to 4,500 tpd and the incremental investment in fixed plant and mobile equipment has been included in the capital expenditure schedule above. It is expected that the economy of scale realized by the expansion of the mine and processing plant will yield a decrease in the cash cost per payable pound of copper produced of between $0.75 and $1.00 per pound of payable copper.
The expansion of the processing plant to 4,500 tpd capacity will include an additional 13' x 18' primary ball mill and two 130 m3 and eight 5 m3 tank flotation cells. This will provide not only sufficient additional rougher flotation capacity but also allow for the total reconfiguration of the cleaner circuit to further optimize final concentrate quality. Additional crushing capacity will be achieved by more fully utilizing the available runtime of the existing equipment so the expansion to 4,500 tpd is capital efficient. The installation of the additional equipment can also be carried out with minimal disruption to current production.
A new tailings thickener and the paste backfill plant is also expected to improve the recovery of water from tailings. The existing tailings storage facility offers short-term capacity, while the majority of the tailings from the expanded production scenario will be stored in a new facility to be developed to the east of the current operation. It is anticipated that 40% of tailings will be delivered to the underground mine as paste backfill.
Arsenic reduction in the copper concentrate will be achieved using partial roasting technology. The roaster was selected and the contract awarded to Technip on February 26, 2013 with an expected 46 week delivery period. Pilot tests conducted using high arsenic content concentrate from Aranzazu showed a decrease of arsenic content by 85%. The expected arsenic content in the treated concentrate once the roaster has been commissioned is 0.3% and the roaster package includes a performance guarantee of a maximum of 0.5%. It is expected that the roaster will decrease arsenic related charges and penalties by up to $1.00 per payable pound of copper produced. The roaster has been presented to SEMARNAT, the Mexican Environmental Authority, and SEMARNAT has authorized the roaster as a modification to the existing operating license.
Most Popular Stories
- Slow Week Ahead of December FOMC Meeting
- Hispanics Seek to Grow School Board Members
- GM Bailout Saved 1.2 Million U.S. Jobs, Report Says
- 'Knockout Game': Myth or Menace?
- Questions Remain in Jenni Rivera's Death
- Bitcoin Used to Buy Tesla Car
- Banks Fret as Volcker Vote Approaches
- Paul Walker Fans Pay Respects
- 18 L.A. Sheriff's Deputies Face U.S. Charges
- Yellen Set to Become One of World's Most Powerful Women