World Copper (TSXV: WCU; US-OTC; WCUFF) has released a positive preliminary economic assessment for its Escalones copper project. The property is within the renowned Chilean porphyry copper bet that runs north-south in the central Andes Mountains. It is only 35 km from Codelco’s El Teniente mine, one of the world’s largest underground copper mines.
World Copper is anticipating a 50,000 tonne-per-day open pit mine and heap leach operation that will treat a total of 365.8 million tonnes of mineralized material. Copper will be recovered from the pregnant leach solution using solvent extraction and electrowinning technologies. Estimated copper recovery is 72.5%.
The initial capital requirement at Escalones is US$428.4 million, followed by a sustaining investment of US$192.5 million over the 20-year life of the project. Payback of the initial capex will occur after 2.2 years.
The average annual copper production during the first five years of operation will be 124.7 million lb. at an all-in sustaining cost of US$1.42 per lb. of copper. During that time, the head grade should average 0.49% copper.
At a copper price of US$3.20 per lb., Escalones has post-tax numbers including a net present value, with an 8% discount rate, of US$1.5 million and an internal rate of return of 46.2%.
“Escalones has several attributes that make it attractive for development including robust economics, strong value metrics and the potential of rapid returns for a comparably low capital investment,” World Copper president and CEO Nolan Peterson said in a press release. “These factors combine leading to a profitability index in the top quartile of peer group companies with a capital intensity in the bottom quartile. Furthermore, the Project’s lowest quartile position on the global cash cost curve indicates profitability in even the weakest copper market scenarios.”
The Escalones deposit has an inferred resource of 426.2 million tonnes grading 0.367% copper for 3.4 million contained pounds of acid soluble copper.
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