Equinox causes a stir with flurry of news

It’s been a busy week for Equinox Minerals and the market has taken notice.

The company announced the doubling of the mine life at its Lumwana copper project in Zambia, higher capital costs for the project, the completion of a private placement and the discovery of an anomaly near Lumwana.

It’s been a lot of news for the market to digest, and while volume has been near the highest amongst miners over 25 million shares have been traded since June 26 — the reaction to the news has been up and down.

Thankfully for Equinox, the reaction was up on July 6. Shares finished the day almost 7% higher, or 8, closing at $1.29 on roughly 8 million shares traded.

The movement was spurred-on by the July 5 announcement of the discovery of a series of prospective anomalies stretching over a 2 km strike length known as the Kanga prospect.

The anomalies occur 300 metres on strike and to the south of the Malundwe main pit one of two pits that compose Equinox’s Lumwana copper project.

Equinox says Kanga may be a continuation of the controlling mineralizing structure that hosts Malundwe.

Induced Polarization geophysics was used to detect the anomaly, and now the company plans to begin a drilling program this month on the area. Equinox is planning to do 10,000 metres of reverse circulation drilling.

Located just 5 km. from where the Lumwana processing plant will be situated, the company believes the anomaly could lead to better economics for Lumwana.

In a release, Equinox’s president Craig Williams says the geophysics that lead to the discovery of Kanga, and the drill program planned for the area are just the “first steps by Equinox in its substantially expanded Zambian exploration effort.”

The news of the anomaly came just five days after the company announced the closing of a private placement that raised a total US$30 million.

Equinox says the bulk of the net proceeds will go into the Lumwana project, an expanded Zambian exploration program and for general working capital.

And just six days ago, on June 28, the company announced a 21% increase in the measured and indicated resource for Lumwana.

The Lumwana project which is scheduled to be commissioned in the first quarter of 2008 will process ore from both the Malundwe and the Chimiwungo pits.

Combined the two pits now have a reserve of 321 million tonnes of ore grading 0.73% copper and an inferred resource of 417 million tonnes grading 0.6% copper.

The company says that its in-fill drilling program, the re-design of the Lumwana pits and a copper price of US$1.20 a lb. resulted in the 28% increase in reserves for Malundwe and the 70% increase for Chimiwungo.

Those increases, Equinox says, mean the estimated mine life has gone to 37 years from 18 years.

But coinciding with the growing reserve are growing capital costs. Equinox now estimates the pre-production capital costs to be US$762 million, up US$213 million from its prior estimate of US$549 million.