Engineering & Mining Journal

NOV 2017

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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REGIONAL NEWS - U.S. & CANADA 10 E&MJ • NOVEMBER 2017 a hydrometallurgical cobalt refining opera- tion on a railhead in the town of Blackfoot to the southeast. A combined cobalt-cop- per-gold concentrate would be produced at the mine site and processed at the Black- foot plant. The vertically integrated proj- ect would produce cobalt chemicals for the rechargeable batteries market, as well as byproduct copper concentrate, copper sulphate, magnesium sulphate and gold. The feasibility study assumes an un- derground mine production rate of 800 short tons per day (st/d) at a 0.25% cobalt cut-off, yielding a weighted average annu- al production of 2.4 million pounds (lb) of cobalt, 3.3 million lb of copper, and 3,000 ounces (oz) of gold over a 12.5-year mine life. Gross revenue during the life of the mine is estimated to derive 75% from co- balt sulphate, 15% from copper sulphate, 5% from magnesium sulphate, 4% from gold, and 1% from copper concentrate. Substantial construction was com- pleted at the ICP mine site from 2011 to 2013, but the project was placed on care and maintenance in May 2013 due to low metal prices. By that time, approximate- ly $65.3 million had been spent on ICP development for earthworks, engineering, and milling equipment, including the crushing, ball mill, flotation, and filtra- tion circuits; pumps; grizzlies; hoppers; and conveyors, etc. These are sunk costs and are not included in the remaining ini- tial capital costs, which are estimated at $186.7 million. The preproduction development pe- riod for the current project is estimated at 24 months. Mine life is estimated at 12.5 years. "Pre-construction activities are under- way in preparation for project construction and mine development contingent upon successful project financing," said eCobalt Solutions President and CEO Paul Farqu- harson. "The project's main competitive strengths are having a primary cobalt de- posit located in the United States and a high-reserve grade when compared to other existing sources of cobalt located globally." "The feasibility study highlights multi- ple opportunities to enhance the econom- ics of the project, including expansion of the resource, optimization of the mine plan to process higher-grade material, and detailed engineering at the cobalt processing facility to further reduce risk and improve capital and operating costs," he added. "This is a robust project that could eventually be the sole primary pro- ducer of cobalt in the United States." The ICP feasibility study was prepared by Micon International in conjunction with SNC Lavalin. Haile Gold Mine Achieves Commercial Production OceanaGold Corp. announced that the Haile gold mine commenced commercial production on October 1. "The achieve- ment of commercial production is a major milestone. It was through the hard work and dedication of our workforce and un- wavering support from our shareholders, local stakeholders and partners that we are at this pivotal point only less than two years after taking ownership of this world-class asset located in South Carolina," said Mick Wilkes, OceanaGold president and CEO. "The operation is back on track following the disappointment of the second quarter." Commissioning of the Haile process plant took longer than the company expect- ed. Issues related to the commissioning of the Carbon-in-Leach (CIL) circuit along with load imbalances in the milling circuit led to lower throughputs and recoveries. "Process plant throughput has im- proved and is close to design rates, while grade and recoveries are in line with our expectations," Wilkes said. "Over the course of the next several months, we will continue to ramp-up operations and focus on fine-tuning of the process plant for in- cremental improvements." Wilkes said all aspects of the opera- tion have been transitioned to the opera- tions team and the commissioning team has been demobilized. Mining operations continue to progress as planned with min- ing of sulphide ore at both the Mill Zone and Snake pits while mine reconciliation has been in-line with expectations. The company's near-term focus is to further improve mine productivity and operator training to align with OceanaGold's global operations standards. Taseko Building Test Facility at Florence Copper Taseko Mines is proceeding with construc- tion of a production test facility (PTF) at its Florence in-situ copper recovery project in south-central Arizona. The go-ahead for the PTF followed final project permitting approval by the Environmental Protection Agency. Estimated remaining costs to construct the PTF stand at $25 million. As outlined on the project website, the PTF will be based on 24 wells: four injection wells, nine recovery wells and 11 groundwater monitoring-related wells. Among other objectives, the facility is ex- pected to demonstrate to residents and regulatory agencies that in-situ copper recovery is a safe and proven process and to demonstrate and enhance best water management practices to maximize effi- cient water use and optimize new treat- ment technologies employed at the site. The facility will also further test and re- fine the in-situ recovery method. "We now have all necessary state and federal permits in place to build and op- erate the PTF," said Taseko President and CEO Russell Hallbauer. "Our board of di- rectors, after a thorough review of current market conditions, the company's finan- cial position, and the status of permitting in Arizona, have endorsed management's view that the best course of action is to accelerate the construction of the facility. "Over the past year, Florence personnel have been advancing on-the-ground activi- ties and have spent roughly $4 million spe- cific to the PTF. With major components already on site, the timeline to having the test facility operational is in the latter half of 2018 and involves the construction of an SX/EW facility and the drilling of obser- vation, injection and recovery wells. "At $4,700/mt of installed capacity, Florence Copper is one of the lowest cap- ital intensity copper projects in the world. The economics of the project are too com- pelling for us to not be rapidly advancing the project toward commercial produc- tion, especially as a significant global copper deficit approaches. Successful operation of the PTF will be a major step toward realizing the $920 million net present value of the project." At full production, the Florence cop- per project is forecast to produce 81 mil- lion lb/y of copper over a 21-year operat- ing life. Total preproduction capital costs are estimated at $200 million. A well recovers copper at the Florence project.

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