Asarco to fund development of Minto copper mine in Yukon

In order to develop the Minto copper mine in the Yukon, Minto Explorations (MXO-V) has teamed up with its major shareholder, Asarco (AR-N).

Asarco will acquire a 70% interest in the project and provide up to US$25 million toward its development. Minto, which will act as operator, will retain a 30% stake.

The Minto project consists of a 525,000-ton-per-year, open-pit mine and mill, situated 150 km northwest of Whitehorse. Yearly output during the first five years of operation is projected at 27 million lb. copper, 10,000 oz. gold and 160,000 oz. silver. Construction is expected to start this summer, and the initial mine life is expected to be 13 years.

Minable reserves are estimated at 7.2 million tons grading 2.13% copper, 0.015 oz. gold and 0.22 oz. silver per ton, with a 4.1-to-1 stripping ratio.

The capital cost of the operation is estimated at $29.8 million, based on a mining and milling cost of $21.24 per ton, an exchange rate of $1.35, a gold price of US$380 per oz. and a silver price of US$5.25 per oz.

Asarco has purchased 1 million units of Minto Explorations at $1.40 per unit, each of which consists of one common share and one non-transferable share purchase warrant. One warrant and $1.40 will entitle Asarco to purchase one additional share for one year.

Following exercise of the warrants, Asarco will own 55.8% of the issued and outstanding common shares of Minto Explorations.