At its 75%-optioned Tambo Grande polymetallic project in northwestern Peru,
Discovered earlier this summer, TG-3 is now estimated to contain a total of 110 million tonnes grading 1% zinc and 0.7% copper, as well as 0.7 gram gold and 19 grams silver per tonne.
TG-3 consists of two distinct mounds of mineralization.
The north lobe is typically richer in zinc, and, based on a cutoff grade of 1% copper-equivalent, contains 20 million tonnes grading 2.7% zinc and 0.9% copper, plus 0.8 gram gold and 35 grams silver. It includes a higher-grade 15 million tonnes averaging 3.6% zinc, 0.7% copper, 0.9 gram gold and 45 grams silver.
The copper-enriched south lobe is up to 300 metres thick in places and hosts 48 million tonnes grading 1.1% zinc and 1.1% copper, plus 0.9 gram gold and 25 grams silver, based on a 1% copper-equivalent cutoff. The resource estimate includes a higher-grade zinc zone of 28 million tonnes grading 1.5% zinc, 1% copper, 0.9 gram gold and 29 grams silver.
In total, 20,179 metres in 53 holes were completed on TG-3 during the first round of drilling. The higher-grade zones in both mineralized lobes remain open for expansion.
TG-3 lies beneath a good portion of the Piura River and its flood plain. It sits about 500 metres south of the more advanced TG-1 sulphide deposit, which hosts an inferred resource of 64.2 million tonnes grading 1.4% zinc and 1.7% copper, as well as 0.7 gram gold and 31 grams silver, based on a cutoff grade of 1% copper-equivalent.
Included in this estimate is a higher-grade copper zone of 18 million tonnes grading 2.4% copper, 0.1% zinc, 0.7 gram gold and 30 grams silver, as well as zinc zone of 34.9 million tonnes grading 2.4% zinc, 0.9% copper, 0.8 gram gold and 36 grams silver. Preliminary analysis suggests that TG-1 could be mined by open-pit methods at a stripping ratio of about 1-to-1.
The TG-1 sulphide deposit is overlain by a near-surface, flat-lying oxide cap containing an inferred resource of 1.3 million oz. gold and 12.4 million oz. silver in 8 million tonnes grading 5.2 grams gold and 48 grams silver. A preliminary pit design indicates a low stripping ratio of 1.2-to-1. Metallurgical tests indicates recoveries in excess of 90% for gold and 75% for silver can be achieved from the oxide cap. Studies on both the oxides and sulphides are continuing, with further results expected in the first quarter.
The oxide cap represents a good portion of the prestripping required to mine the underlying TG-1 sulphides. Manhattan believes the oxide material could be processed in a 5,000-tonne-per-day conventional cyanide-in-leach (CIL) processing plant to produce an annual 250,000 oz. gold and 1.8 million oz. silver during the first five years of the mine life at cash costs of under US$50 per oz. (net of silver credits). Capital cost predictions are in the range of US$125 million, which includes costs associated with moving the town of Tambo Grande.
Manhattan believes the underlying TG-1 sulphides could be brought on-steam for another US$100-125 million at the rate of 15,000 tonnes per day through years six to fourteen of the mine life. TG-3 would be brought in at 50,000 tonnes per day in the mine’s fifteenth year at an additional cost of US$200-250 million.
A second round of drilling, consisting of 50,000 metres, is under way at Tambo Grande. Two rigs are turning in the town of Tambo Grande, testing the northern extension of the oxide gold cap in an attempt to boost the resource to beyond 2 million oz.; another two are conducting infill drilling on TG-1, at the edge of town; while a fifth has begun testing targets on the Papayo joint-venture concessions, to the south.
A prefeasibility study on TG-1 and TG-3 is expected to by mid-2000.
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