Monywa copper project reaches production stage

Indochina Goldfields (ING-T) has begun producing copper cathode at the Monywa heap-leach copper project in west-central Myanmar.

Construction of the first-phase project is essentially complete, with commercial shipments and sales scheduled to begin next month. Full-scale production of copper cathode at the annual rate of 25,000 tonnes is anticipated in the first quarter of the new year.

Mine-owner Myanmar Ivanhoe Copper, a 50-50 joint venture between Indochina and state-owned Mining Enterprise No. 1, is focusing on the Sabetaung and Kyisintaung deposits. Together the deposits host reserves of 155 million tonnes grading 0.47% copper, plus total resources, based on a cutoff grade of 0.15% copper, of 560 million tonnes averaging 0.32% copper.

Mining began last March at the daily rate of 12,000 tonnes, and was followed by leaching in August. Two million tonnes averaging 0.97% copper are now on the pads and leaching in a manner consistent with results obtained from pilot-plant tests.

Production was achieved under budget but three months behind schedule — a function of procurement and logistic difficulties experienced by the fixed-cost construction contractor. As compensation, the contractor paid Myanmar Ivanhoe US$3.8 million in cash.

Direct operating costs are expected to average US42 cents per lb. copper, while total costs of delivered copper is projected at US61 cents per lb. copper. These costs, however, are expected to fall to US38 cents and US60 cents per lb. copper, respectively, by 2001, when a second phase of expansion ramps up production to 130,000 tonnes annually.

Expansion will involve boosting annual production at Sabetaung and Kyisintaung to 35,000 tonnes, to be immediately followed by equivalent-sized production at the nearby Letapadaung deposit. Once in production, Letapdaung will be incrementally increased to as much as 94,000 tonnes annually, resulting in the overall projected production rate.

Reserves at Letapdaung are pegged at 1.07 billion tonnes grading 0.4% copper. Tests on the deposit’s ability to leach without crushing are to be carried out in the existing pilot plant, and it is hoped the results will be similar to those of earlier tests that showed “acceptable and economically attractive” metal recoveries.

Capital costs for the second-phase program are projected at US$40 million and will add to the US$35-million direct investment by Indochina and a US$90-million recourse loan facility.