Indochina Goldfields exceeds Monywa projections

The Monywa heap-leach copper project in west-central Myanmar is operating better than expected, reports half-owner Indochina Goldfields (ING-T).

Monywa is a 50-50 joint venture between IG and state-owned Mining Enterprise No. 1. Miners are focusing on the Sabetaung and Kyisintaung deposits, which together host reserves of 155 million tonnes grading 0.47% copper. The total resource, based on a cutoff grade of 0.15% copper, is estimated to be 560 million tonnes averaging 0.32% copper.

Production in December 1998 topped 2,117 tonnes of London Metal Exchange Grade A copper cathode at an average cost of US42 cents per lb., which includes shipping and marketing fees of US5 cents per lb. Cost-cutting measures, including a 14% reduction in electricity costs and a reduction in a government-held 4% production royalty, are being implemented in an effort to reduce operating costs by US5 cents per lb.

To date, 3,164 tonnes of copper have been produced from the more than 2.5 million tonnes of ore that have been placed on the pads since mining began in March 1998. (Production was delayed until early November, resulting in a US$3.8-million compensation payment from the contractor.) Half of the project’s output before July has been sold forward at US71 cents per lb.

Indochina plans to expand production by 10,000 tonnes, to 35,000 tonnes per year. The program is expected to cost US$7.5 million and begin by year-end.

Following the expansion, IG will set about developing the nearby Letpadaung deposit at a similar rate. Production would then be incrementally increased to as much as 94,000 tonnes, resulting in total project output of 130,000 tonnes yearly.

Reserves at Letpadaung are pegged at 1.07 billion tonnes grading 0.4% copper (9.4 billion lbs. copper). Discussions for financing development are under way.