Chilean government allows Placer to evaluate Andacollo

A wholly owned Chilean subsidiary of Placer Dome (TSE) was recently awarded the right to evaluate the feasibility of developing a mine at the Andacollo porphyry copper deposit in northern Chile.

The award was made by the Chilean government mining corporation after a call for proposals and bids on the property. If a mine is developed, it would be held and operated by a company owned 80% by Placer Dome Chile and 20% by the state mining corporation.

The Andacollo deposit is estimated to contain preliminary reserves of 274 million tons grading 0.62% copper, with “potentially significant gold content.”

This copper project should not be confused with the Andacollo gold project owned by Dayton Developments (TSE) in central Chile which is expected to begin production early next year.

Placer Dome President Tony Petrina said the company’s 50% owned La Coipa gold mine is nearing completion in Chile, so the timing is opportune for the company’s next investment in the South American country.

“The large contained copper resource, with potential gold values, could also fit with Placer Dome’s long-term strategy of expanding its base metal production,” he added.

Placer Dome Chile will pay US$1.2 million for the right to evaluate the deposit, and contribute US$4.8 million to the capital of the new corporation. The company will have one year to prepare a feasibility study.