Vancouver — With an Environmental Clearance Certificate (ECC) already in hand, Australian-based Lafayette Mining has upped the total mineral resource at the Ungay polymetallic deposit on TVI Pacific’s (TVI-T) Rapu Rapu property in the Philippines.
Using data from 16 additional drill holes, Lafayette tabled an undated resource of 7 million tonnes grading 1.2% copper, 2.1% zinc, 2.6 grams gold and 28.1 grams silver per tonne. Of this, 6.4 million tonnes are classified as measured with grades of 1.3% copper, 2.2% zinc, 2.66 grams gold and 28.9 grams silver.
The oxide portion of the deposit now stands at 270,000 tonnes grading 3 grams gold and 34.5 grams silver The new calculation marks a significant boost from the 5.6 million tonnes previously tabled. A new reserve estimate is expected shortly.
Located in the east-central part of the country, the past-producing property has a positive feasibility study in place, which envisions mining the Ungay deposit as an open-pit operation treating 4.9 million tonnes of material grading 1.4% copper, 2.4% zinc, 30.4 grams silver and 2.71 grams gold per tonne over a six-year mine life.
The 820,000-tonne-per year-operation would produce 61,000 tonnes copper, 89,000 tonnes zinc, 3.6 million oz. silver and 293,000 oz. gold annually. Projected capital costs are slated at US$37.8 million, generating an internal rate of return of an impressive 30%.
A “Besshi-type” massive-sulphide deposit, the project was originally discovered in the 1960s. It reportedly produced some 200,000 tonnes of ore from an underground operation. Mineralization is hosted as bands and lenses conformable to the schistocity of low-grade metamorphosed schists. In 1991, ore reserves were pegged at 3 million tonnes grading 1.8% copper, 2.5% zinc, 40 grams silver and 2-3 grams gold.
West of the planned open pit, Lafayette has a rig turning to test for mineralization below the old Karogrog mine. Operated by Hixbar Gold Mines from the late 1930s until the 1960s, the mine still holds 1.1 million tonnes grading 1.3% copper, 2% zinc, 25 grams silver and 2.7 grams gold. The Karogrog orebodies occur as thick lenses of massive sulphides hosted in quartz-sericite schist. The main orebody was 140 metres long, 60 metres wide and 30 metres thick.
Having received an ECC from the Philippine government, Lafayette has launched an aggressive development program, which includes a study into the cost of constructing the mine, the conclusion of project financing and secure agreements with smelters.
Project construction is expected to take about a year and could begin as early as the fourth quarter of 2001.
Based on an earlier deal to acquire a majority stake in the property, Lafayette granted TVI 3.3 million options in the Australian junior at a price of A20, as well as a net smelter royalty of 2.5%.
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