Engineering & Mining Journal

OCT 2018

Engineering and Mining Journal - Whether the market is copper, gold, nickel, iron ore, lead/zinc, PGM, diamonds or other commodities, E&MJ takes the lead in projecting trends, following development and reporting on the most efficient operating pr

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Page 29 of 91

NEWS - CONTINUED 28 E&MJ • OCTOBER 2018 by Cementation to prepare the existing shaft and hoist infrastructure in advance of commencement of underground con- struction activities. Nevada Copper has awarded an engi- neering, procurement, and construction (EPC) contract for the surface plant and infrastructure to Sedgman USA Inc., a member of CIMIC Group, for a fixed price of $118 million. The EPC contract follows several months of a detailed engineering and design program conducted by Sedg- man incorporating a number of significant improvements to the earlier prefeasibility study of the Pumpkin Hollow underground project published in November 2017. Following the completion of the PFS, Nevada Copper has undertaken further review and detailed design. A number of project optimizations and operational de-risking measures have been incorpo- rated, including a centralized mine design that provides greater operational efficiency for the underground mine and construc- tion of a ventilation shaft via blind sink that provides a lower-risk method to sup- port schedule compliance and further en- hances optionality for future operations. The company continues to review fur- ther project enhancements, including de- bottlenecking to increase plant through- put and the potential for decline access to the E2 orebody. The Pumpkin Hollow property also hosts an open-pit project. In mid-Sep- tember, Nevada Copper announced pos- itive results from a preliminary econom- ic assessment of open-pit development that considers production of an average of 177 million mt/y of copper in concen- trates over a mine life of 20 years. PEA Supports Clayton Valley Lithium Project in Nevada Cypress Development Corp. has reported the results of a preliminary economic as- sessment (PEA) of its Clayton Valley lith- ium project in Nevada, about 200 miles northwest of Las Vegas. A 15,000-metric- ton-per-day (mt/d) nominal mine produc- tion rate is assumed, with a goal of pro- ducing 20,000 mt/y of lithium carbonate. Further improvements in the production schedule are possible given that the re- sources in the initial pit far exceed the 219 million mt of mine production need- ed to support a 40-year mine life. The Clayton Valley PEA was prepared by Global Resource Engineering (GRE) of Denver, Colorado. Capital costs to develop the project are estimated at $482 million. Pre-production and operating costs are estimated at $3,983/mt of lithium car- bonate. The PEA is based on an assumed lithium carbonate price of $13,000/mt. No drilling or blasting will be required to mine the Clayton Valley project, and the only major piece of mobile equipment will be a front-end loader to feed the in- pit feeder-breaker. Waste mining is mini- mal, amounting to a total of 6 million mt over the 40-year mine life. The plant design by GRE includes agitated tank leaching and a multistage thermal-mechanical evaporation system for concentrating leach solution. Slur- ried feed will be transported to the mill, where lithium extraction will be achieved through leaching at elevated tempera- tures with dilute sulphuric acid. The sulphuric acid concentration is targeted at 5%, with concentrated acid delivered from an on-site acid plant. Estimated acid plant capacity is 2,000 mt/d of sulphuric acid, generated from the combustion of elemental sulphur trucked to the site in a molten state. The acid plant has the potential to produce up to 25 megawatt (MW) of electricity but at addi- tional capital expense. The PEA assumes that only enough electricity will be gener- ated to run the acid plant. Steam from the plant will be used for heating in the leach- ing and evaporation stages of processing. Process water for the operation will be obtained by recycling barren leach solution after treatment in a reverse osmosis plant and by introducing fresh makeup water, estimated at 345 m 3 /hr and delivered via pipeline from a well field located off-site. Project labor is estimated at 136 on- site employees. GRE has recommended further work to advance the Clayton Valley project, includ- ing bench-scale testing, to demonstrate the recovery of lithium product. Cypress intends to proceed with this recommenda- tion, beginning with the collection of rep- resentative sample material. The company is also continuing to work on permitting and other aspects of project development. Equinox Acquiring Mesquite Gold Mine from New Gold Equinox Gold has agreed to acquire the Mesquite heap-leach gold mine in south- east California from New Gold for $158 million in cash. The acquisition immedi- ately establishes Equinox as a gold pro- ducer. The mine's 2018 production is forecast at 140,000 to 150,000 oz of gold at all-in sustaining costs of $1,000 to $1,045/oz. The mine has produced an average of 135,000 oz/y of gold over the past 10 years. The transaction is scheduled to close in the fourth quarter of 2018. The Mesquite mine is located 200 miles south of Equinox Gold's Castle Mountain heap leach gold project in California, strengthening the company's regional presence and providing oppor- tunities for regulatory, social, permitting, operating, and administrative syner- gies. Further, the development of Castle Mountain will benefit from Mesquite's experienced open-pit heap leach opera- tions team. Phase 1 production at Castle Moun- tain is estimated at 45,000 oz/y of gold over a period of one to three years, with commissioning planned for late 2019. Phase 2 is planned produce an average of 203,000 oz/y during years four through fourteen. Equinox is also looking for near-term production of 136,000 oz/y from its con- struction-stage Aurizona gold mine in Brazil. As of December 31, 2017, the Mes- quite mine had an estimated 1.13 million oz of gold in proven and probable reserves and 1.18 million oz in measured and in- dicated resources exclusive of reserves, representing 25% and 40% additions, respectively, to Equinox's current reserve and resource base. The Mesquite mine has produced more than 4 million oz of gold since it began operations in 1985. Mining is performed using owner-operated conventional truck and shovel open-pit mining methods, and run-of-mine ore is hauled directly to the leach pad for processing. Mesquite mineral rights cover a total area of approximately 1,890 ha. Equinox CEO Christian Milan said, "The Mesquite gold mine will bring imme- diate production and cash flow to Equinox Gold from a well-established operation in an attractive mining jurisdiction. Mes- quite is the perfect fit for our portfolio of gold assets at this stage of growth and ad- vances our strategy of becoming a major gold producer over the next few years." (Regional News-U.S. & Canada - from p. 13)

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