BASE METALS SPECIAL — Imperial Metals builds Mount Polley mine

Imperial Metals (IPM-T) has begun constructing its 55%-owned Mount Polley gold-copper mine, near Williams Lake in south-central British Columbia.

Contracts exceeding $40 million have been awarded for mine pre-stripping and site preparation, tailings dam construction, supply and installation of concrete, fabrication and supply of mill and crusher buildings, and design and construction of all electrical systems.

Startup is anticipated for autumn 1997.

All of the major processing equipment for a 3-stage crushing system and 2-line, rod-ball-pebble mill grinding circuit, including concentrator and crusher buildings, have been purchased.

Total construction costs are not expected to exceed $123.5 million. Imperial will fund its share of costs with $54 million of debt financing it has arranged with partner Sumitomo Corp. of Japan, which holds the remaining 45% interest in the project. At the end of April, Imperial had a working capital of $16.5 million.

Mount Polley hosts a reserve, minable by open-pit methods, of 82 million tonnes grading 0.42 gram gold per tonne and 0.3% copper for a contained resource of 1.1 million oz. gold and 544 million lb. copper. The stripping ratio is 1.16-to-1.

Reserves are open for expansion within the project pit limits and elsewhere on the property. The total geological resource stands at 133 million tonnes grading 0.36 gram gold and 0.27% copper.

At a production rate of 18,000 tonnes per day (6.5 million tonnes per year), the mine is expected to produce 100,000 oz. gold and 24 million lb. copper per year. Over a 12-year mine life, annual production will likely average 71,500 oz. gold and 29 million lb. copper.

The production cost per ounce of gold, with copper as a credit, is projected to fall in at less than US$180 per oz.

Construction is expected to create about 200 jobs, and once in operation, the mine will employ 170.

Imperial Metals has 57 million shares outstanding, or a fully diluted 63 million shares.