“There can’t be many lower-risk copper growth tasks than Arizona Sonoran Copper’s Cactus,” CEO George Ogilvie stated throughout a Thursday convention name. “This undertaking is totally going into manufacturing as a standalone enterprise case.”
The NPV and IRR progress are pushed by the combination of the MainSpring deposit–renamed to Parks/Salyer after its March acquisition and proving it was the identical deposit in a mid-July useful resource replace. The primary 20 years of the mine’s 31-year life places annual manufacturing at 232 million lb. copper and, underneath a 31-year state of affairs, 5.3 billion lb. complete copper cathode at improved efficiencies, lowering each mining and processing prices.
In afternoon buying and selling in Toronto shares rose C$0.45 to C$1.75 apiece, which supplies it a market capitalization of C$91.3 million. Shares touched C$0.98 and C$1.88 over the previous 12 months.
The 20-year mine plan focuses on higher-grade ore from the Parks/Salyer and Cactus West deposits. In distinction, the 31-year plan extends operations to incorporate lower-grade sources from the Cactus East deposit and legacy stockpiles, guaranteeing “generational” worth creation, Ogilvie stated.
The preliminary capital prices of $668 million is modest for contemporary copper developments, however the sustaining capital of $1.2 billion makes up for it. The $425 million enhance in sustaining capital over the PFS pertains to the expanded mine plan, which now contains extra intensive open-pit operations.
Repositioned undertaking
On the assumed base worth of $3.90 per lb. copper, the payback is 4.9 years. Over its life, the undertaking can generate a web free money movement of $7.3 billion, rising to $9.8 billion at $4.50 per lb. copper. That’s up from $2.4 billion of free money within the earlier examine.
The undertaking hosts 632.6 million measured and indicated tons grading 0.58% copper for 7.3 billion lb. of steel, and 474 million inferred tons at 0.41% copper for 3.8 billion kilos. The estimate displays complete copper quantities contained in ore, no matter which technique it’s mined or processed.
“We achieved and much surpassed every purpose to reveal main NPV, IRR, payback, and all different operational and financial metrics from the Cactus undertaking,” Ogilvie stated. “The mixing of MainSpring was transformational, offering substantial worth to the undertaking whereas lowering dangers related to mining operations.”
The money value has lowered to $1.82 per lb. from $1.84, and the all-in sustaining value for the undertaking fell to $2.00 per lb from $2.34, reflecting the expanded mine plan and added infrastructure, giving economies of scale.
Arizona Sonoran plans to advance Cactus in the direction of one other pre-feasibility and feasibility examine in a yr, additional refining the undertaking’s economics and learning extra optimization probabilities.
Location, location, location
Cactus’ beneficial location and established infrastructure underpin the low-cost construction. “We’re in a singular and lucky state of affairs that we’ve world-class infrastructure instantly on our doorstep, and we’ve a really sturdy social licence from the area people,” Ogilvie stated of the close by city of Casa Grande, about 10 km northwest.
Cactus advantages from being on non-public land, which might help streamlines allowing by avoiding federal regulatory delays. The corporate is working carefully with state regulators in Arizona and has already secured key permits.
“We’re solely coping with native and state regulators, who’re very supportive of the undertaking,” Ogilvie stated in response to a query about allowing delays on the close by Decision copper undertaking, a 55-45% three way partnership between BHP (ASX: BHP; LSE: BHP; NYSE: BHP) and Rio Tinto (NYSE: RIO; LSE: RIO; ASX: RIO). “Each allow we’ve gained has been secured inside six months of software.”
Commenting on the latest heap leach pad failure in Yukon, Ogilvie harassed the corporate’s dedication to security, highlighting that the Cactus design contains extra engineering to forestall related incidents. The undertaking’s location on flat, arid land additional reduces danger elements related to leach pad instability.
“We’re completely over-designing our leach pads to make sure we’ve the suitable elements of security,” Ogilvie stated. “The flat terrain and dry situations at our web site present a big benefit in sustaining stability.”