Mt Morgan to cost A$85m

PERTH (miningweekly.com) – The Mount Morgan gold/copper project, in Queensland, will require a capital investment of A$85-million, ASX-listed Carbine Resources has reported.

The company on Thursday revealed the results of a feasibility study into the Mt Morgan project. Based on a 1.1-million-tonne throughput rate, the project is expected to have a nine-and-a-half-year mine life, producing 30 000 oz/y of gold and 3 800 t/y of copper sulphate.

The project is expected to have a C1 cash cost of A$395/oz, and an all-in sustaining cost (AISC) of A$549/oz.

“The feasibility study delivers a strong base case for the development of a long-life project at Mt Morgan. The project also has the potential to deliver a new generation of thinking towards environmental cleanup, heritage sustainability and community interaction,” said Carbine Resources MD Tony James.

James said from the company’s perspective, after a short pay-back period of only two years, the project could provide a steady cash flow for many years enabling a strong growth platform for the company.

“From an environmental perspective, the project has the potential to make some significant in-roads into the environmental legacy associated with acid mine drainage at Mt Morgan, with the processing and removal of pyrite from the dumps.”

The project’s life could be increased to around 20 years, as a substantial inferred mineral resource existed within the remnant tailings in the Sandstone Gully and Mt Morgan openpit.

The expanded case will see the production of some 18 000 oz of gold and 2 000 t of copper sulphate during years 10 and 20 of the mine life, while C1 cash costs for the expanded production will be around A$384/oz and AISC around A$576/oz.

The preproduction capital cost for both the base case and expanded case will remain consistent at A$85-million; however, the overall capital required for the base case over the life-of-mine is estimated at A$94.4-million, and at A$116.1-million for the expanded case.

The Carbine board has taken the decision to advance the project finance options, as well as optimise offtake arrangements for the premium unroasted iron pyrite market, while continuing with the regulatory approvals process and consolidating the project ownership.