Aurex expanding Chile operations

The expansion of Cobrex’s copper-gold-silver project in Chile is well under way and Aurex Resources (VSE) expects to be operating at 650 tonnes per day by July.

Aurex acquired a 70% interest in Cobrex in January by assuming US$2.7 million in debt and agreeing to pay US$1.3 million cash (of which US$250,000 is paid) over 3 years and three months.

Cobrex owns and operates a copper-silver mine and three processing plants 50 km east of La Serena in northern Chile. Proven and probable reserves are about 1 million tonnes grading 1.3% copper and 38 grams silver per tonne. The operation is processing 400 tonnes per day grading 1.3% copper and 38 grams silver.

Aurex subsequently acquired a 1,500-tonne-per-day flotation mill for US$950,000 and is busy transplanting the facilities to the Cobrex operations. Cobrex should be operating at 1,200 tonnes per day by the end of 1994. A further expansion to 2,000 tonnes per day is planned, provided the company is successful in expanding reserves to the 8-million-tonne level. Aurex is also scheduled to complete the acquisition of a 70% interest in the San Esteban operation in May. The project is in the Copiapo area, 850 km north of Santiago.

Consideration for the property includes cash payments totaling US$4.2 million over two years, a purchase option on 300,000 common shares and a graduated net smelter royalty on future production in excess of 3.5 million tonnes. San Esteban includes a 700-tonne-per-day mill and three producing copper-gold mines with proven reserves estimated at 1.8 million tonnes grading 1.1% copper and 1.7 grams gold per tonne.

Aurex plans to expand the mining and milling operation to 1,200 tonnes per day by

the first quarter of 1995. The expansion would boost production to 3.9 million kg (8.5 million lb.) of copper and 590,000 grams (19,000 oz.) of gold per year at an estimated cash cost of US99 cents per kg (US45 cents per lb.) of copper, including credits.