Partners size up Collahuasi’s Rosario Oeste (October 24, 2005)

Some 4,658 metres worth of drilling in 8 holes in 2005, coupled with 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 no. 198, which yielded 139.5 metres (beginning at a depth of 228 metres) containing 10.4% copper, and hole no. 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 no. 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 the subject of 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.

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 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 (FAL.LV-T, FAL-N) and Anglo American (AAUK-Q) (both with 44% interests); a Japanese consortium lead by Mitsui and Co. holds the remaining 12%.