BASE METALS SPECIAL — Ivan copper mine reaching design capacity

Production rates and profits are climbing at the Ivan copper mine operated by Minera Rayrock (MRN-T), shareholders were told during the annual meeting in Toronto.

The Chilean mine produces cathode copper by means of solvent extraction-electrowinning (SX-EW). It turned out 5.2 million lb. copper during the first quarter and posted an operating profit of US$2.7 million, up from US$1.7 million in the same period in 1995. Bacterial leaching of sulphide ore provided a steadily increasing portion of production in the recent 3-month period.

Minera Rayrock President David Crombie told shareholders that production costs this year have averaged US60 cents per lb. “The quality of the cathode copper has improved and now demands a premium.”

Last year, the company produced 19.3 million lb. of cathode copper, which is equivalent to roughly 88% of design capacity. Production during the first five months of 1996 was 8.7 million lb., which represents 95% of capacity.

This year, Minera Rayrock plans to increase SX-EW production by 7%. By year-end, a decision is expected on a proposal to build a small sulphide flotation plant that would produce 2,500-3,000 tonnes per year of copper-in-concentrate.

Ivan is a low-altitude operation (by Chilean standards) and is accessible by paved road, which allows employees to commute to work. Total reserves are estimated at 3.7 million tonnes grading 2.4% copper. Of this total, oxide reserves stand at 2.4 million tons of 1.8% copper, while sulphide ore amounts to 1.3 million tons of 3.4% copper.

Exploration work at Ivan is testing a new body of sulphide-dominant ore discovered below the 600-metre level. The new target is estimated to contain 300,000-500,000 tonnes of mixed ore grading about 2.5-3% copper. More drilling is planned.

Not far from Ivan, Minera Rayrock is carrying out evaluation work and metallurgical tests at its wholly owned Sierra Valenzuela copper project. A preliminary study points to 31.4 million tonnes grading 1.18% copper (at a cutoff grade of 0.5%). The estimate is based on six of the 12 deposits identified to date.

Preliminary, proven and probable minable reserves stand at 17.7 million tonnes grading 1.33% copper, and the project is envisaged as a stand-alone, heap-leach operation.

Minera Rayrock is also exploring for copper in other parts of Chile, and owns an advanced gold deposit in Costa Rica.

Early-stage exploration is under way in Panama, with four gold-mineralized areas identified to date at the Muro Dorado gold project.