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MEI Online: Commodities: Metallic Ores: Copper: Latest News: October 2nd 2015
:: Amerigo Processes new Tailings Source in Chile
Amerigo Resources hasn’t lost much time since it cut a deal with Codelco in April 2014 to treat a new source of tailings from the miner’s El Teniente mine, the world’s largest underground copper operation, near Santiago, Chile.
Until now, the Vancouver-based company has been processing fresh tailings from El Teniente and historic tailings from the mine’s Colihues tailings deposit.
This week, however, after a construction period of just five and a half months, Amerigo’s Chilean subsidiary, Minera Valle Central S.A. (MVC), has started processing historic tailings from El Teniente’s Cauquenes storage area, adjacent to Colihues, at a rate of 30,000 tonnes per day.
That number should rise to 60,000 tonnes per day, management predicts, once the first phase expansion of the processing facility is completed at a total cost of about US$71 million, in the fourth quarter of this year.
Klaus Zeitler, Amerigo’s chairman and chief executive, could not be reached for comment before press time, but in a news release noted that once the first phase expansion is completed, the company’s annual production from all three sources of tailings at El Teniente will rise to 70 million pounds of copper, with cash costs decreasing to “significantly less” than US$2.00 per lb.
Cash costs are expected to decrease from US$2.08 per lb. in 2014 to around US$1.75 per lb., according to a corporate presentation in July. (MVC trimmed cash costs from US$2.48 per lb. in 2012 to US$2.08 per lb. in 2014.)
Upon the completion of all phases of the expansion, the company estimates that annual copper production will rise to about 90 million lbs. at cash costs of about US$1.50 per lb.
Over the next 15-20 years, Zeitler says, Cauquenes is expected to add significant value to the company, which has rights to process tailings from El Teniente until Dec. 31, 2037.
The MVC operation, in Region IV about 90 km south of Santiago and about 8 km east of the city of Rancagua, produces copper and molybdenum concentrates by reprocessing El Teniente’s tailings.
The operation has generated positive cash flow every year since the plant was built in 1992.
Cauquenes contains 338 million tonnes grading 0.27% copper, significantly higher grade than the nearby Colihues’ tailings, which average 0.20% to 0.23%, and Cauquenes' material is also higher grade than the mine's fresh tailings.
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