Quadra raises funds to revive Robinson

Vancouver — Quadra Mining (QUA-T) has raised $145 million as part of a broad effort to become a mid-tier, base metal mining and exploration company, and used some of the proceeds to acquire the Robinson copper mine project, near Ely, Nev.

The company intends to revive the mine, which is in an area where copper, gold and silver have been mined for more than a century.

Quadra paid BHP Billiton (BHP-N) US$14.3 million for the fully developed, 38,000-tonne-per-day mine-and-mill complex, built in 1996 at a cost of US$480 million. BHP acquired the project when it took over Magma Copper but suspended operations in 1999, owing to weak metal prices and production shortfalls. At the time of closure, the spot price for copper was 64 per lb., while the spot gold was a mere US$260 per oz.

In 1999, almost 87,860 tonnes were mined, at head grades averaging 0.56% copper and 0.34 gram gold. Recoveries of 79% for copper and 45% for gold were achieved. Past records show that the process facilities had a history of not achieving design production; however, Quadra believes minor modifications, such as the installation of a semi-autogenous grinding machine, will enable it to achieve projected throughputs. Plans also call for a gravity circuit to boost recovery of coarse gold. The company notes that the concentrator and related infrastructure are in good condition and have been well-maintained.

One pit has been mined out, and the remaining reserves and resources are found in the Tripp-Veteran and Ruth open pits. These deposits together host a measured and indicated resource of 738,808 tonnes grading 0.43% copper and 0.16 gram gold per tonne, based on a cutoff grade of 0.2% copper. This total includes proven and probable reserves of 104,642 tonnes grading 0.72% copper and 0.29 gram gold, at a waste-to-ore stripping ratio of 3.9-to-1.

The capital cost of resuming mining at Robinson is pegged at US$20.7 million; this does not include prestripping and startup operating losses estimated at US$23.6 million.

Total severance, closure and reclamation costs are estimated at US$67 million, based on existing plans, though the company expects to reduce costs by using the mined-out Liberty pit for tailings disposal.

CEO William Myckatyn and President Paul Blythe, both experienced mining professionals, head Quadra’s management team. The company has other copper projects in British Columbia and Chile.