LATIN AMERICA — Aur Resources off to strong start at Andacollo

Aur Resources’ (AUR-T) first mine outside of Canada, the Andacollo open pit in Chile, began producing cathode copper on schedule in November 1996 and is expected to reach full production by June of this year.

The mine, a heap-leach operation 380 km north of Santiago, contains about 31.9 million tonnes grading 0.73% copper and is Aur’s second major copper operation after its 30%-held Louvicourt copper-zinc-gold-silver mine in Quebec. Aur predicts the Andacollo will boost its copper production by about 88% beginning in 1997.

Developing Andacollo required expenditures of US$52.8 million, while the total direct net capital expenditures are expected to fall within budget at US$82.9 million. The work has thus far entailed open-pit mining of 4.4 million tonnes of waste and 1.1 million tonnes of ore at a soluble grade of 0.79% copper. Aur also built an ore-crushing plant, eight heap-leach pads, an irrigation system, a solvent extraction-electrowinning plant and administrative facilities, together with its associated power and water lines. The remaining 11 heap-leach pads will be completed by year-end.

The electrowinning plant produced 3.8 million lb. of cathode copper during 1996, and Aur expects Andacollo to produce another 40.6 million lb. from 2.7 million tonnes of ore in 1997. Plans call for the production of 44 million lb. of copper annually over a mine life of 11 years.

Mine operating costs are projected at US$22.2 million, or US55 cents per lb.

of copper. A total of 6.3 million tonnes of waste and low grade ore will also be mined at a projected stripping ratio of 2.4-to-1.

The leachable copper deposit being mined is underlain by a large primary porphyry-type copper-gold deposit, which has a resource of about 600 million tonnes grading 0.4% copper and 0.13 gram gold per tonne at a cutoff grade of 0.3% copper.

Mining at Andacollo is carried out under a contract with Henry Walker Mining, with company personnel employed in the crushing, stacking, leaching and electrowinning operations.

The property is held by Minera Carmen de Andacollo, which is 70% owned by Aur and 30% owned by Minera del Pacifico. A Chilean government body, Enami, holds a 10% net profits interest.