Copper developer
The transfer marks the completion of a relocation plan that will allow Frontera to develop the Piedras Verdes copper deposit, below the old townsite. The local Ejido (agrarian co-operative) agreed to relocate to the new site, with full municipal services, 6 km south of the project site.
In September, Frontera received two permits for construction at Piedras Verdes from the Mexican government’s Environment and Natural Resources Secretariat. One covered mine and plant construction, and the other the extension of roads and power lines to the operation. The company had received a water licence from the National Water Commission in May.
Frontera engaged Spanish mining contractor Grupo PEAL in July for a 66-month term to cover development and the first five years of mining at Piedras Verdes. It also hired main construction manager M3 Engineering and Technology in June.
Piedras Verdes, 21 km north of Alamos in southeastern Sonora, has a reserve of 191 million tonnes at an average grade of 0.36% copper, and Frontera plans an open-pit mine with a solvent extraction — electrowinning plant to produce 32,000 tonnes copper annually. The capital cost of the project has been estimated at US$70 million with another US$30 million in sustaining capital, based on contract mining by PEAL.
The project’s cash operating cost is estimated at US$1,230 per tonne (US56 per lb.) over an 18-year mine life and at US$1,275 per tonne in the first five years of production. Assuming a copper price of US$2,090 per tonne (US95 per lb.) the project has a net present value of US$61 million at an 8% discount rate, and an internal rate of return of 20.4%.
Be the first to comment on "New townsite opens up at Piedras Verdes"