Atlas to expand silver-lead-zinc operations in Bolivia

An expansion program is under way at the Andacaba and Don Francisco mines in the Potosi district of southern Bolivia.

The zinc-lead-silver producers were acquired by a subsidiary of Atlas (AZ-N) in October 1996. This year, the Denver-based company acquired the Koyamayu zinc-lead-silver property, also in southern Bolivia, as well as the nearby Vicormo mill.

Gregg Shafter, vice-president of project development, says these acquisitions have returned the company to operating status and will generate positive cash flow. “We will now focus our efforts in Bolivia on expansion of operations, including contemplated gold exploration concentrating on areas in and around our existing infrastructure there,” he says.

Atlas expects to complete the expansion program at Don Francisco and Andacaba in the first half of this year. Commercial production at Koyamayu is targeted to begin in the second half of the year, at a rate of 50-100 tonnes per day.

Based on the results of limited recent production, grades at Koyamayu are estimated to be 18% zinc, 4% lead and 3.5 oz. silver per tonne.

A capital investment of US$250,000 will be required to place the recently purchased Vicormo mill into operation later this year. The processing rate is expected to be 250 tonnes per day. Atlas plans to use the mill to process ore from its surrounding mines later this year and is currently evaluating its potential to treat material from the Don Francisco and Koyamayu properties.

During the last quarter of 1996, 19,176 tonnes (grading 7.2% zinc, 2.72% lead and 8.63 oz. silver per tonne) were milled at Andacaba, to produce 998 tonnes of zinc, 386 tonnes lead and 135,662 oz. silver.

The Don Francisco mine underwent development work during the quarter, resulting in minimal production.

Closer to home, Atlas acquired an industrial perlite mine and processing plant in Oregon. Operations are expected to begin later this month.

The company also holds a large land package and a dormant mill in Nevada’s Battle Mountain trend. A portion of the project had been optioned to Vista Gold (VGZ-A). However, this joint venture was recently terminated, with all of the ground returned to Atlas. A separate joint venture with another company, for 30% of the property, remains in effect. Atlas says several companies have expressed interest in the Gold Bar claims, and it will consider these proposals, as well as an outright sale.

In other news, the company’s chief executive officer, Mario Caron, resigned to take up a similar post with another mining company. A committee of directors and officers will manage Atlas until a new CEO is named.