Cristinas start hinges on mining law

Though a feasibility study at the Cristinas project in Venezuela is projecting yearly output at 450,000 oz. gold at an average cash cost of US$205 per oz., Placer Dome (TSE) is waiting to schedule construction.

A production decision is dependent on a new mining law being drafted by Venezuela, a provision of which includes a significant increase in gross royalty fees. The fee currently stands at 1%.

The new law includes a revised fiscal and regulatory regime for gold mining investment in the country, and is expected to be made final by mid-year. Only then will Placer Dome, which is 70% owner, make a production decision. The feasibility study is based on a 40,000 tonne-per-day mine and mill, the capital cost of which is now estimated at US$565 million. Earlier estimates put the cost of the operation at US$400-million, but the addition of a flotation circuit to the proposed leach circuit has increased costs. The tailings impoundment and treatment system are also more elaborate, and more costly, than originally estimated.

Minable reserves, which are contained in two deposits within one open pit, are estimated at 205 million tonnes grading 1.22 grams gold per tonne and 0.12% copper. The stripping ratio is projected at 0.88-to-1.

An estimated 60% of recoverable gold will come from the copper concentrate, while the balance will be recovered as dore from the leach circuit.

The mine is expected to employ 840 people once production begins.

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