Los Andes Copper envisions big project at Vizcachitas

Los Andes Copper (TSXV: LA) says its Vizcachitas project — a copper-molybdenum porphyry deposit 150 km northeast of Santiago, in central Chile — will be the South American country’s next major copper mine.

The project, which would produce copper and molybdenum concentrates from an open-pit mine and concentrator, sits at a relatively low elevation of 2,000 metres above sea level, and is just 65 km from a railway in San Felipe, with connections to the Port of Ventanas and the Ventanas smelter, 140 km away, and the Chagres smelter, 90 km from the deposit.

A preliminary economic assessment of the project, released in early June, outlines a 45-year mine life at a 110,000-tonne-per-day processing rate, and initial US$1.87-billion capital expense.

The massive deposit has measured and indicated resources of 1.28 billion tonnes grading 0.396% copper, 141.4 parts per million molybdenum and 1.05 parts per million silver, for a copper-equivalent grade of 0.451% and 11.2 billion contained lb. copper, 400 million lb. molybdenum and 43.4 million oz. silver, or 12.78 billion lb. copper-equivalent.

Drill core V2015-04 from Los Andes Copper’s Vizcachitas project in Chile. Credit: Los Andes Copper.

Inferred resources add 789 million tonnes grading 0.337% copper, 127 parts per million molybdenum and 0.88 parts per million silver, for a copper-equivalent grade of 0.386% and 5.86 billion lb. copper, 221 million lb. molybdenum and 22.3 million oz. silver, or 6.71 billion lb. copper-equivalent.

“The copper content of the ore is competitive, when compared to what is being developed by new greenfield projects [around] the world,” Fernando Porcile, the company’s executive chairman, tells The Northern Miner in an telephone interview from Chile, adding that “Vizcachitas has large, geological resources that are well identified, and is still open at depth, and to the north.

“The strong economic viability of the project — with an after-tax net present value, at an 8% discount rate, of US$1.8 billion, an internal rate of return of 20.77% and 3.4-year payback period — indicates that not only is it financially robust, but it also has the ability to generate positive cash flows in a short period of time … the type of mineralization also allows high recoveries with coarse grinding, and the resulting concentrate has low impurities.”

The company expects to complete a feasibility study by the end of 2020.

While the project benefits from surrounding infrastructure, with few surrounding population centres, it is within 100 km of three large operating mines: Antofagasta’s (LON: ANTO) Los Pelambres, Codelco’s Andina mine and Anglo American’s (LON: AAL) Los Bronces.

Porcile joined the company in May, after decades developing several greenfield and brownfield copper projects and mines for large companies, including Falconbridge (El Morro, Pachon, Collahuasi), Rio Algom (Cerro Colorado, Antamina and Spence) and Codelco (El Teniente and Chuquicamata). He says Vizcachitas “can be developed into a large and competitive, operating mine.”

“I have been in the mining business for more than 50 years — for large greenfield and brownfield projects, and operations — and this project compares very well,” he says. “Considering the conditions, this should not be that difficult to develop … this is a good orebody.”

At press time, Los Andes Copper traded at 37¢ per share in a 52-week trading range of 15¢ to 38¢. The junior has a $96-million market capitalization.