Some 120 drillholes point to a resource of 219 million tonnes grading 1.14% copper and 0.34 gram gold per tonne. The drilling has penetrated 600 metres below the surface, though drill spacing is only 80 metres in the main targets.
Phelps Dodge, which shares the property equally with Brazilian-based Companhia Vale do Rio Doce (CVRD), says preliminary metallurgical tests demonstrate excellent copper and gold recoveries with minimum impurities.
The partners have also started prefeasibility work, which should be completed by the second quarter. A final feasibility will follow, to be completed by year-end.
Phelps Dodge and CVRD formed their joint venture in 1998, under the name Mineracao Serra do Sossego.
Elsewhere in Brazil, Phelps Dodge operates a carbon plant (in Cubatao) and a wire and cable plant (in Minas Gerias).
In 1999, the company produced 890,100 tonnes of copper, making it the world’s second-largest producer.
Earnings for the year totalled US$21.7 million (or 35 per share) before after-tax charges of US$279.5 million ($4.54 per share). The charge includes a US$201-million writedown on the value of the Hidalgo smelter in New Mexico and an US$88-million writedown on value of the concentrator at the Morenci operation in Arizona.
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