Miners will tap into oxide reserves of 79 million tonnes grading 1.18% copper and sulphide reserves of 231 million tonnes grading 1.13% copper. The reserve base was confirmed in a July 2004 feasibility study, which in turn was based on 133,000 metres of drilling in 555 holes plus samples from a 1,100-metre exploration tunnel.
The oxides and sulphides will be mined from a single open pit but processed on separate heaps to increase recovery; the oxide ore will be treated by conventional chemical heap-leaching, while the sulphide ore will subjected to bacterial leaching.
The resulting solutions will be sent to separate oxide and sulphide solvent-extraction (SX) plants. From there, the solutions will be fed to a single electrowinning (EW) plant to produce copper cathode.
The mine will produce about 200,000 tonnes copper cathode per year over a lifespan of 19 years, with the first cathode scheduled to come off the line in the last quarter of 2006.
Copper cathode will be transported west through either of the ports of Antofagasta or Mejillones, and sold on the world market.
Mine access is excellent (the deposit was discovered in the Atacama Desert under Highway 25, some 150 km northeast of Antofagasta), but BHP Billiton will need to divert the highway and build a 50,000-tonne-per-day crushing circuit, two leach pads, two parallel SX plants, and the EW circuit.
The mine will also benefit from a relatively benign altitude of 1,700 metres and easy access to electrical power, water, and rail lines.
The company has already entered into an agreement with Aker Kvaerner to provide construction management.
“Spence is the best undeveloped copper orebody known in the world today,” says Diego Hernandez, BHP Billiton’s president of base metals. “Its large reserves, low operating costs, and high return potential will enable it to operate as one of the world’s top-tier mines.”
Canadian miner Rio Algom discovered Spence, a blind copper-porphyry deposit, in 1996. The deposit came into Billiton’s hands in 2000 via a US$1.2-billion takeover of Rio Algom, and a year later, Billiton merged with BHP.
In March 1999 in Toronto, Rio Algom’s exploration team at Spence of John McClintock, Michael Thicke, Siegfried Weidner and Angus Campbell picked up the Bill Dennis Award for Prospector of the Year at the convention of the Prospectors & Developers Association of Canada.
Rio Algom named the deposit “Spence” in honour of one of its geologists, Colin Spence, who was murdered in 1996 in the Philippines while scouting out Climax Mining’s Dinkidi gold-copper deposit.
BHP Billiton already has a large presence in Chile as operator and 57.5%-owner of the world’s largest copper mine, Escondida, 170 km southeast of Antofagasta.
The combined reserves of Escondida and the Escondida Norte deposit (5 km to the north) were last pegged at 2 billion tonnes copper sulphide grading 1.24% copper, 1.7 billion tonnes low-grade copper sulphide grading 0.55% copper, and 290 million tonnes copper oxide grading 0.73% acid-soluble copper.
For the quarter ended Sept. 30, 2004, BHP’s attributable, payable copper production from Escondida was 142,500 tonnes, up from 116,000 tonnes a year earlier, reflecting the restoration of full production capacity. (In 2001, BHP instituted a company-wide, 170,000-tonne-per-year reduction in copper output in response to sagging copper prices.)
The Escondida Norte deposit will begin feeding concentrators by the fourth quarter of 2005, while low-grade sulphide ore is being stockpiled for processing in a bioleaching facility now under construction.
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