`Glasnost’ brings Polish mine, VSE junior together

The recent letter of agreement was signed by International Coast Minerals (VSE) and The Copper Mining and Smelting Industrial Group (KGHM) of Lubin, Poland, and involves a possible recovery operation of copper and other metals from five tailings ponds.

KGHM is the largest primary copper producer in Europe. Its annual ore production from five underground mines is about 30 million tons, with recovery of up to 380,000 tons of refined copper and over 500 tons of silver from four metallurgical plants.

International Coast, on the other hand, is a small Vancouver junior that has been working on gold properties on Vancouver Island. Its directors include Tom Waterland, president of the Mining Association of British Columbia.

In a recent meeting with company officials, The Northern Miner learned the small junior had signed an agreement to test and possibly reprocess and extract all economic minerals from about 370 million tons of tailings material, something Japanese and Swedish competition had tried unsuccessfully to do several years earlier.

“It was a case of perfect timing and of having previously established connections in Poland,” said President Waldo Ejtel. During a recent visit to Poland, Ejtel and Jerzy Palka, vice-president exploration and development, retained Palka’s former colleague, Jan Tomaszewski, a university professor and former head of the applied geology department of the Copper Institute in Poland, as their consultant and advisor on the project.

Finding it difficult to finance the recovery project on their own because of the country’s debt crisis, state-run KGHM was receptive to the idea of International Coast financing and managing the project in return for a share of production.

Wright Engineers will be preparing a preliminary feasibility study on the project at a cost of about $25,000 and, if it’s positive, KGHM and International Coast would then define the details of financing, marketing, profit sharing and other related matters in a final agreement. While Ejtel conceded that it’s possible for the political climate to change and jeopardize the deal, he said this was “a small risk in view of the tremendous rewards”.

According to a KGHM company report, the copper ore deposits have explored reserves estimated at 50 million tons grading an average of 2% copper, plus minor amounts of silver, lead, zinc, cobalt, nickel, molybdenum, vanadium, rhenium, selenium and gold. The main copper minerals are chalcocite, bornite, chalcopyrite and covellite.

The copper deposits have three types of ore and have posed a challenge to the company in the mining and milling process, which in turn has affected metal recoveries.

International Coast drilled four holes and sampled the Gilow tailings pond for testing in Vancouver under the supervision of an independent consulting geologist. The Gilow tailings pond is estimated by KGHM geologists to contain about 145,000 tons of copper and 505 tons of silver.

The Irons Bridge tailings pond, the largest of the five, is estimated by KGHM geologists to contain 447,000 tons of copper and 1,650 tons of silver.

Officials from KGHM will be visiting Vancouver in mid-May to discuss a second project with International Coast, this one involving the processing of slimes from the smelting process.

KGHM’s proposal involves the creation of a joint venture for the construction and operation of a 30,000-ton-per-year capacity lead and other metals plant for the slimes treatment.

KGHM has about 150,000 tons of slimes stored in sedimentation ponds with an additional 35,000 tons per year being added to this. The composition of the materials to be processed will be about 70% slimes, and 30% dust.

The corporation’s engineers have informed International Coast that the slimes contain between 38-44% lead, 2-4% copper, 4-7% zinc and 4.37-8.75 oz silver, along with other metals.

According to International Coast, KGHM has received the technology for construction and processing of the slimes. The preliminary estimated costs of the project would involve a contribution of $18 million(US) from International Coast while KGHM would contribute the equivalent amount in Polish zloty. Revenues to International Coast would be paid in metal production.

Ejtel said the company would contract any necessary engineering expertise to bring the project to fruition, or possibly enter into a business relationship with a senior mining company.

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