Work halted at Magistral

Vancouver — Anaconda Peru, a wholly owned subsidiary of London-based Antofagasta, has decided not to increase its stake in the Magistral copper project in north-central Peru.

The subsidiary had considered increasing its interest to 65% from 51% in exchange for completing a bankable feasibility study, but decided instead to focus on projects in Chile.

Inca Pacific (ip-v) maintains a 49% interest in the project and has a right of first offer on Anaconda Peru’s 51% interest.

Magistral lies 140 km northwest of the large Antamina polymetallic deposit, currently being mined jointly by Noranda (NRD-T), Rio Algom (ROM-T), Teck Cominco (TEK-T) and Japan-based Mitsubishi. The resource at Magistral is about 105 million tonnes grading 0.74% copper, 0.052% molybdenum and 3.9 grams silver per tonne, based on a cutoff grade of 0.5% copper. Mineralization is found disseminated in a quartz-monzonite intrusion, as well as in a skarn aureole. The property is underlain by a sequence of northwesterly striking, westerly dipping sedimentary and carbonate rocks of Jurassic-to-Cretaceous age.

Anaconda has completed a US$3-million exploration program on the property, with drilling aimed at defining a high-grade core. The resource lies in a saddle-shaped body of mineralization that measures 1.2 km long by 125 metres wide.

In 1998, the government of Peru auctioned Magistral, and Inca won the bid by agreeing to pay US$750,000 and spend US$2.1 million on exploration. Inca will have seven years to complete a feasibility study and develop the project.