Cyprus Amax Minerals (CYM-N) will proceed with the development of the Cerro Negro copper project, adjacent to its Cerro Verde copper mine in southern Peru.
The projected cost of developing Cerro Negro, which lies 20 miles southwest of Arequipa, is US$99 million. Actual construction costs will be US$82 million, with US$17 million earmarked for costs related to financing, working capital and inflation.
Drilling began in April 1995, and the company has determined a minable reserve of 70 million tons of oxide material grading 0.53% copper.
The company hopes to reduce development costs by sharing its solvent extraction-electrowinning facilities and administrative support with Cerro Verde.
The Cerro Verde mine completed an expansion program in 1996 and is now producing 120 million lbs. of copper annually — more than 14% above design capacity.
Production from Cerro Negro will add another 44 million lbs., bringing the total to more than 160 million lbs., says Marj Charlier, director of investor relations for Cyprus.
Development of Cerro Negro will involve construction of an open-pit mine, a crushing plant, a conveyor, a stacker and a new leach pad. Construction will begin in early 1998 and last two years. Full production is planned for the second quarter of 2000.
Cyprus owns an 82% stake in the Cerro Verde operation, including Cerro Negro.
Buenaventura (BVN-N) owns 9%, and the remainder is publicly held.
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