Kansanshi moves forward

Vancouver First Quantum Minerals (FM-T) is wasting no time in advancing its newly acquired Kansanshi copper deposit in Zambia.

The project hosts an open-pit mineral resource of 267 million tonnes grading 1.28% copper and 0.16 gram gold per tonne.

First Quantum acquired its 80% stake in the property from Cyprus Amax, a wholly owned subsidiary of Phelps Dodge (PD-N), by paying US$50,000, assuming US$27.45 million in gross debt (US$25 million net of cash) and issuing 1.4 million shares.

Thirty days after commercial production begins, the junior producer must also pay US$25 million less the market value at the time of 1.4 million of its shares.

Government-held Zambian Consolidated Copper Mines (ZCCM) holds the remaining 20% interest

"The work carried out by Cyprus Amax Minerals and Phelps Dodge is of exceptional quality and we intend to move as quickly as possible to complete the definitive bankable feasibility study," says Rod Webster, CEO of Kansanshi Mines. "The construction of a long-lived, low-cost, open-pit mine at Kansanshi will serve as a catalyst for further development in the area."

With US$25 million already spent on exploration and development at Kansanshi, First Quantum has launched a bankable feasibility study. This will consider the potential development of a large-scale open-pit mine capable of producing 50,000-100,000 tonnes copper per year.

The study is expected to be complete in nine months. Perth-based GRD Minproc has been selected as project manager of the study.

Based on 100,900 metres of drilling, the pit-contained resources for the deposit come in at:

• 77.9 million tonnes grading 1.58% copper in the measured category;
• 126.2 million tonnes grading 1.18% copper in the indicated category; and
• nearly 63 million tonnes averaging 1.11% copper in the inferred class.

Lying in the northwestern portion of the country, some 15 km north of the town of Solwezi and 16 km south of the border with the Democratic Republic of Congo, Kansanshi is one of the oldest known mines in Zambia.

Since the discovery of ancient workings in 1899, the deposit has been intermittently mined for high-grade copper from both underground and open pit. The total production to date is approximately 80,000 tonnes copper.

In January 1997, as part of the privatization of ZCCM, Cyprus Amax Minerals entered into an agreement with ZCCM and the Government of the Republic of Zambia to secure majority ownership of the Kansanshi project. This agreement was finalized on March 14, 1997.

Cyprus Amax, which was subsequently acquired by Phelps Dodge, completed over 80,000 metres of drilling and produced a preliminary feasibility study in April 2000.

The Kansanshi deposit occurs within the Lufilian arc, a major tectonic province (characterized by broadly north-directed fold and thrust structures) which hosts the world-class Central African Copperbelt.

The property’s geology is dominated by the northwest-trending Kansanshi Antiform, which exposes rocks of the Late Proterozoic Kansanshi Mine Formation in the core of a major refolded fold.

Copper mineralization occurs in steeply dipping, generally north-south trending quartz-carbonate veins and as essentially flat-lying, bedding-controlled, stratabound mineralization within altered phyllitic rocks.

The deposit has been defined in two areas — the Main zone and the Northwest zone. Supergene enrichment and subsequent oxidation of the original sulphide mineralization have produced oxide and mixed and hypogene ore types.

A US$1-million infill drill program is under way.