M3 Engineering & Technology of Tucson, Ariz., used a copper price of US95 per lb. in preparing the study.
Minable reserves are estimated at 191 million tonnes grading 0.36% copper. Further resources adjacent to the open pit have yet to be determined.
The study is based on 70,000 metres of drilling, as well as metallurgical testing and process design work. Costs were analyzed and a technical report prepared.
The deposit, 21 km northwest of Alamos, will be mined by open-pit methods, with ore heap-leached and electrowinned. Copper cathode will be produced on-site.
About 70 million lbs. copper cathode will be produced annually for 12 years. The estimated life-of-mine cash cost per pound of copper cathode produced is US52, which translates into an internal rate of return of 18.3%.
A portion of the deposit underlies the village of Piedras Verdes, whose residents have agreed to relocate. The company has bought 35 homes in the village.
Production is expected to begin in early 2006, provided financing is in place by the end of this year. An environmental impact statement is being prepared and an application for an environmental permit will likely be filed by year-end. Also under way are water-well pump tests.
Frontera Copper was incorporated in 2002 to purchase the Piedras Verdes project and bring it into production.
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