Imperial revises Mount Polley reserves

The Mount Polley gold-copper project in central British Columbia, 56 km northeast of Williams Lake, is being readied for a scheduled construction start-up in the spring of 1996.

As part of a due-diligence review required by Japan-based Sumitomo, Imperial Metals (TSE) carried out metallurgical testwork this past summer to confirm the 76.3% copper and 80.4% gold recovery estimates determined in a 1990 feasibility study by Wright Engineers.

Although figures have yet to be released, Imperial President Pierre Lebel says gold recoveries are “much better than expected”, allowing the company to use a lower cutoff gold grade in its revised reserve estimate.

The remodeling of reserves took into account 129 additional holes drilled at Mount Polley since 1990. Ore reserves for the proposed open pit are estimated at 81.5 million tonnes grading 0.41 gram gold per tonne and 0.3% copper, at a stripping ratio of 1.12-to-1. This compares with the 1990 estimate of 49 million tonnes grading 0.56 gram gold and 0.38% copper, at a stripping ratio of 1.76-to-1.

The total geological reserve at Mount Polley stands at 231 million tonnes averaging 0.34 gram gold and 0.26% copper.

The new technical data have been turned over to Sumitomo for assessment. Sumitomo holds the right to acquire a 35% interest in Mount Polley by funding in excess of $85 million through a combination of project debt financing, cost share payments and earn-in expenditures.

Imperial is currently preparing a revised economics report for the project based on the updated reserves.

The initial mine plan, based on the 1990 reserve estimate, called for a 13,600-tonne-per-day operation producing an annual 70,000 oz. gold and 33 million lb. copper over a 10-year life, followed by the treatment of lower-grade material that would extend the mine life for up to four additional years.

Imperial was granted a mine development certificate for Mount Polley in 1992, and has since received all necessary permits to begin construction. During the past two months, the company completed preliminary earthwork development in the minesite area. All major processing equipment required for the project is already purchased, including the concentrator and crusher buildings.

Lebel said the final go-ahead decision on project financing could come by the end of December. The green light will be conditional on the findings of the revised economics report for the larger deposit, and on a satisfactory conclusion to talks with the British Columbia government regarding infrastructure assistance.