Aguablanca gives birth (December 27, 2004)

Rio Narcea Gold Mines (RNG-T) has produced its first batch of nickel concentrate from the Aguablanca nickel-copper sulphide project, 80 km northwest of Seville, Spain.

The grinding circuit and mill of the 1.5-million-tonne-per-year plant are operating at full capacity, and contractors are working to fix some minor bottlenecks identified in the flotation circuit’s piping. The modifications are expected to take less than a week. The plant is expected to hit its stride in early January.

Construction of an 18-km power line was delayed for three weeks, owing to permitting problems, though the high-voltage line was finally energized in late November.

Over a lifespan of 10.5 years, the mine is expected to churn out 8,200 tonnes nickel in concentrate per year, equivalent to about half the current annual output of the European Union. The concentrate will also include some 6,100 tonnes copper and 23,000 oz. platinum group elements (PGEs) as byproducts. Under a long-term, off-take agreement, Switzerland’s Glencore International will buy all the nickel concentrate produced by Aguablanca until 2010.

Aguablanca has open-pit reserves of 15.7 million tonnes grading 0.7% nickel, 0.5% copper, and 0.5 gram PGEs per tonne, based on a cutoff grade of 0.25% nickel. Based on limited drilling, Rio figures underground mining could produce an additional 200,000-300,000 tonnes of ore as soon as 2006.