LATIN AMERICA — Atacama to develop Aguas Blancas

Atacama Minerals (AAM-V) is proceeding with development of the Aguas Blancas iodine heap-leach project in northern Chile.

The project comprises 22,000 ha in the Atacama Desert, 95 km southeast of the port of Antofagasta. Results of heap-leach testing have led to a mine plan that calls for at least 15 years of iodine production.

The leachable ore was found to have a much higher nitrate grade than previously expected. The nitrate and sulphate salts recovered from iodine production will be stockpiled for later processing. At current grades, and assuming the plant is expanded, nitrate production is expected to exceed 100,000 tonnes per year.

The deposit consists of a flat-lying layered series of bands of caliche, which vary in thickness. Measured, indicated and inferred reserves total 97.4 million tonnes of iodine ore grading 580 parts per million iodine and 43.2 million tonnes of 27% sodium sulphate ore. These reserves are contained in only 30% of Atacama’s land holdings, and the company says there is potential to increase the reserves.

Iodine is used worldwide in the pharmaceutical, industrial and agricultural industries. Global consumption in 1999 is expected to total 18,000 tonnes, with a 3% growth rate for the year 2000.

At full capacity, Aguas Blancas will account for 6% of world production. The cost of construction, scheduled to last throughout 2000, is pegged at US$27 million. Initial production will consist of iodine only, at the rate of 1,267 tonnes per year.

Based on a debt-to-equity ratio of 70:30, the internal rate-of-return is 30%.

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