Santa Rosa yields gold for refining

From its pilot plant at the Santa Rosa project in southeastern Peru, Andean American Mining (AAG-V) has delivered the first 7.8 kg of gold concentrates for refining. The shipment sold for US$282.60 per oz.

Since mid-August, the plant has been running continuously at the daily rate of 500 tonnes. Daily production is expected to reach 1,200-1,400 tonnes after various modifications are made, including expansion of the carbon-in-column capacity.

At a daily rate of 1,000 tonnes, the plant is expected to last 4.5 years. The estimate is based on the current resource of 1.5 million tonnes grading 3.85 grams gold and 56.4 grams silver per tonne.

The company is confident ongoing exploration will boost the gold grade to 7-9 grams.

Earlier this year, Placer Dome (PDG-T) inked a deal with Andean to earn a majority interest in the ground surrounding Santa Rosa. The major can earn an initial 55% stake by spending US$3.6 million on exploration and paying US$2.2 million through to January 2004. It can increase its interest to 60% by proceeding with a feasibility study.

Situated 120 km southwest of Cuzco, Santa Rosa consists of 20 concessions covering 133 sq. km. Placer Dome has identified more than 15 targets in a structural trend measuring 15 by 4 km. Andean American has excluded the mine area from its agreement with Placer, though this will change if a production decision is made.