Engineering & Mining Journal

APR 2019

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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NEWS-LEADING DEVELOPMENTS APRIL 2019 • E&MJ 5 Newcrest Planning Block Cave for Red Chris Newcrest Mining has announced plans to develop a block cave mine beneath the currently active Red Chris open pit in northwest British Columbia based on an agreement to acquire a 70% joint-venture interest in the mine from Imperial Metals for $806.5 million. Newcrest operates one of the world's deepest block caves at its Cadia East mine in New South Wales, Australia, and believes its experience there can be put to good use at Red Chris. Red Chris is a gold-copper porphyry with current mineral resources of 20 million ounces (oz) of gold and 13 billion pounds (lb) of copper. The Newcrest-Imperial Met- als agreement encompasses 23,142 ha of land that has promising exploration poten- tial. The property encompasses a total of 77 mineral tenures, five of which are min- ing leases, and is located within the tradi- tional territory of the Tahltan Nation. Newcrest believes the Red Chris orebody has the potential to become a high-margin underground block cave mine and is accelerating the necessary drilling and studies for block cave development. Newcrest also intends to conduct studies and a review of Red Chris ore reserved to allow reporting in accordance with JORC 2012 standards. Newcrest will optimize the current open-pit mine plan and pursue initiatives to improve operational productivities and milling recoveries. Current Red Chris op- erations include an 11-million-metric-ton- per-year (mt/y) processing plant and associ- ated infrastructure that provide brownfield expansion options for the future. Acquisition of its interest in the Red Chris mine is Newcrest's first entry into North America. In its fiscal year to June 30, 2018, the company produced a combined total of 2.364 million oz of gold and 78,000 mt of copper from its Cadia Valley mines in New South Wales, its Telfer mine in Western Australia, its Lihir mine in Papua New Guinea, and its Gosowong mine in Indonesia. Red Chris is forecast to produce in the range of 72 million to 76 million lb of copper and 36,000 to 38,000 oz of gold in calendar-year 2019. "We are delighted to add the Red Chris asset to the Newcrest portfolio," Newcrest Managing Director and CEO Sandeep Biswas said. "Following due diligence, we believe we can bring our unique technical capabilities to unlock the full value poten- tial of this orebody in one of the premier gold districts in the world. "We have identified a clear pathway to potentially turn this orebody into a Tier 1 operation. The geology of Red Chris is similar to our Cadia orebodies in Austra- lia, and we will be applying our consid- erable experience in exploration, open-pit mining, caving, and processing to maxi- mize the value of Red Chris and the op- portunities in the surrounding region. "We are pleased to be establishing a joint venture with Imperial and look for- ward to building collaborative relation- ships with the Tahltan Nation and the government of British Columbia." Fraser Institute's annual survey of mining companies, published February 28, has ranked Nevada as the most favored juris- diction in the world for mining investment in 2018, based on the survey's Investment Attractiveness Index. Jurisdictions in Can- ada, Australia, and the United States dom- inated the top 20 places in the rankings, with Nevada first, followed in descending order by Western Australia, Saskatchewan, Quebec, Alaska, Chile, Utah, Arizona, Yu- kon, Northwest Territories, Newfoundland and Labrador, Manitoba, Queensland, Peru, Nunavut, Idaho, Finland, British Co- lumbia, Ireland, and Ontario. Fraser Institute constructs its Invest- ment Attractiveness Index by combining the survey's Best Practices Mineral Po- tential Index, which rates regions based on their geologic attractiveness, and its Policy Perception Index, a composite in- dex that measures the effects of govern- ment policy on attitudes toward explora- tion investment. The 2018 survey report is based on responses from 291 mining and exploration company executives and senior management, and consultants. The published survey includes nu- merous quotes from survey respondents, some positive and some negative. Re- garding Western Australia one exploration company manager commented, "Western Australia's environmental policies and permitting requirements are streamlined and easy to understand. In addition, well-documented environmental, eco- nomic, and social requirements create a positive experience for investors, while another exploration company manager said, "Western Australia's wonderful new data sets are stimulating exploration in the region." Likewise, in Saskatchewan, an explo- ration company president commented, "This province has an exceptional permit- ting process that is proactive and time- ly, which is positive for investors," while another said, "The provincial government seems supportive of efforts to drill in areas that haven't been explored previously." Regarding Quebec, an exploration company president said, "Quebec's time- ly and effective permitting process is en- couraging for investors." However, anoth- er said, "This province is missing out on valuable investment dollars as a result of its uranium moratorium." Canadian jurisdictions that drew neg- ative responses included British Colum- bia, Manitoba, Nunavut and Ontario. Re- garding Ontario, an exploration company president said, "There is no clear policy/ rules on consultation processes with in- digenous communities, which creates confusion and deters investment." In the United States, Nevada and Utah drew favorable comments, while Colorado and Montana drew negative comments. In Nevada, "The procedures for submitting a Notice of Intent, calculating reclamation costs, and posting exploration bonds are clear and efficiently administered," an ex- ploration company president said. While in Utah, "Government officials at the federal, state, and local levels go out of their way to assist with exploration activities," another exploration company president said. "Colorado's inconsistent and unreason- able regulations are deterring investors," an exploration company president com- mented. While "Montana's ban on cyanide mining is deterring investment," another exploration company president said. This year's Fraser survey includes an analysis of permit times, which were pre- viously evaluated in a separate publica- tion. The analysis is not worldwide, but rather focuses on Canada, Australia, the United States, and Scandinavia. Fraser Institute's "Survey of Mining Companies 2018" is available as a free download at default/files/annual-survey-of-mining- companies-2018.pdf. Nevada Tops Fraser's 2018 Mining Survey

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