Peru’s mining industry will get a major shot in the arm this spring when
The valley-fill, heap-leach operation is expected to produce more than 800,000 oz. this year at a total cash cost of less than US$50 per oz., making it the lowest-cost major gold mine in the world. At the end of 1998, reserves at Pierina stood at 7.2 million contained ounces.
During a meeting with mining analysts earlier this year, John Carrington, Barrick’s chief operating officer, praised his team for building Pierina “in record time and below budget.”
Barrick acquired the Pierina property in the summer of 1996 by acquiring Arequipa Resources for US$790 million. At that time, the junior company founded by Catherine McLeod-Seltzer and geologist David Lowell had drilled only nine holes into the property.
In just over two years, Barrick brought the exploration project into production at a cost of US$260 million. Production began last fall, and by year-end the open-pit mine had turned out 56,860 oz. gold at a cash operating cost of US$48 per oz.
“We’re also investing our time and money into building strong, lasting partnerships with the surrounding communities,” Carrington said. “We’ve built roads and water systems, and improved educational and health care facilities — all part of this long-term commitment.”
By June of this year, Barrick expects to increase its daily mining rate to 64,000 from 44,000 tons. The company is still expanding the mining fleet at Pierina, and once this is completed, in 2001, mining should reach the maximum rate of 83,000 tons per day.
Ore and waste are mined in 30-ft. benches, and the life-of-mine stripping ratio is 1.3-to-1 waste-to-ore. Ore is transported by nine 150-ton, high-altitude haulage trucks, which are tracked by satellite to ensure proper routing of material. A conveyor then transports the crushed ore to the heap-lead pads.
The average grade of ore placed on the leach pad was 0.25 oz. last year, owing to a high-grade starter zone. However, the grade will drop to 0.11 oz. gold this year. Recoveries to date from the Merrill-Crowe process plant have averaged 80% for gold, and 23% for silver, which leaches at a slower rate.
Most of the mineralized zone is stratiform and hosted by a gently dipping unit of felsic tuffs, with some ore occurring within and on the borders of breccia dykes that are associated with a felsic porphyry intrusion underlying part of the deposit. The mineralization is of the high-sulphidation type, with ore mostly associated with a porous vuggy-silica altered rock surrounded by a zone of quartz-alunite-clay alteration.
More than 95% of the known mineralization is oxide, though a sulphide feeder zone has been intersected in the south-central portion of the deposit and will be tested in a deep exploration program this summer. Barrick continues to explore elsewhere at Pierina, as well as on nearby properties acquired as part of the Arequipa transaction.
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