Some 4,658 metres worth of drilling in 2005, coupled with results from 6,248 metres in 12 holes in the early 1990s has led to an initial inferred resource estimate for the Rosario Oeste zone at the Collahuasi open-pit copper mine in the Chilean Andes.
Drill results form the early 1990s are highlighted by hole 198, which yielded 139.5 metres (beginning at a depth of 228 metres) containing 10.4% copper, and hole 216, which runs 2.1% copper over 91.2 metres, beginning at a depth of 396.8 metres. The best result from the ongoing drilling came in hole 223, which included a 104-metre stretch (from 303 metres below surface) running 1.62% copper.
The JORC-compliant inferred resource totals 248 million tonnes grading 1.54% copper at a cutoff grade of 0.4% copper. At a cutoff of 0.7% copper, the resource slips to 226 million tonnes of 1.63% copper.
The resource estimate comprises a limited block in the central portion of the Rosario Oeste zone, just 300 metres from the edge of the Rosario open pit. The zone remains open to the north, south and at depth. In all, the resource is estimated to represent just half of the total prospective area.
Copper mineralization is principally contained in a structurally controlled chalcocite supergene blanket covering a series of high-sulphidation veins. Areas of the resource containing elevated arsenic levels will be subject to further study.
Future exploration work will also target a strong electromagnetic anomaly around 600 metres south of Rosario Oeste. Several other targets are located immediately south and southwest of the Rosario deposit.
At the end of 2004, Collahuasi had proven and probable reserves totalling 1.85 million tonnes running 0.9% copper, and measured and indicated resources of 480.8 million tonnes of 0.64% copper. Inferred resources weigh in at 1.82 billion tonnes at an average grade of 0.75% copper.
Mining moved to the Rosario orebody from the partially depleted Ujina and Huinquintipa zones during 2004.
During the third quarter, Collahuasi produced 100,000 tonnes of copper, down from around 148,000 tonnes in the corresponding period of 2004. The decrease is attributed to a 34% fall in head grades to 0.98% copper and lower mill throughput associated with material handling problems.
Meanwhile, the 4,300-tonne-per-day molybdenum plant at Collahuasi is expected to hit its commercial stride in November. The plant was commissioned in late September, two months ahead of schedule and under budget. Production is initially pegged at 4,000 tonnes of molybdenum-in-concentrate per year, eventually ramping up to 8,000 tonnes.
In other news, a feasibility study of a project aimed at eliminating bottlenecks and increasing the design capacity of Collahuasi’s sulphide circuit by more than 20% will begin shortly; results are expected by early 2006.
Collahuasi, the world’s fourth-largest copper mine, is a joint venture between
Falconbridge ended the third quarter with net income of US$214 million (or US56 per fully diluted share) on revenue of US$2 billion, compared with year-ago earnings of US$118 million (US38 per share) on US$1.7 billion. Income from operations totalled US$434 million, up 19% from a year earlier. The improved performance comes compliments of higher metal prices.
The results include those of Noranda, which merged with Falconbridge on June 30.
On the production side, refined nickel production increased 22% to 28,600 tonnes, while the company’s realized nickel prices rose 4% to US$14,950 per tonne. Likewise, refined copper output climbed by 18% to 138,000 tonnes; the company realized US$3,790 per tonne of refined copper sold, up 28% from a year earlier. Still, the higher copper prices were partially offset by lower production from Collahuasi and the Antamina mine in Peru.
At the end of September, Falconbridge had US$692 million in cash and equivalents, down 22% from the end of 2004; the company’s long-term debt totals US$2.9 billion.
Falco CEO Derek Pannell maintains a positive outlook for copper, zinc and aluminum prices, while he says the nickel market is in the midst of a temporary adjustment as demand catches up with new stainless steel supply.
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