Metallica Resources (MR-T) has received a positive final feasibility study for its wholly owned Cerro San Pedro gold-silver project near San Luis Potosi, Mexico.
Mining permits and project financing are expected by year-end, with commercial production targeted for the fourth quarter of 1998.
The deposit contains proven and probable reserves of 77.3 million tonnes of oxide ore grading 0.6 gram gold and 24.8 grams silver per tonne.
The study calls for open-pit mining of 30,000 tonnes per day over a mine life of eight years. The stripping ratio is estimated at 1.5-to-1.
Gold and silver recoveries are projected at 74% and 48%, respectively.
Production costs for the project are targeted at US$169 per oz. gold (treating silver revenue as a credit), and annual production is forecast at 143,000 oz. gold and 3.8 million oz. silver. Mining at Cerro San Pedro would incur a capital cost of about $64.5 million.
“The results of the final feasibility study represent a major milestone for the successful development of the Cerro San Pedro gold-silver project,” says Metallica Chairman Craig Nelson. “With this positive study, management is committed to moving quickly through permitting and financing to construction in order to commence commercial production within the next 18 months.”
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