LOS AZULES PROJECT
Los Azules is a 100% owned advanced-stage porphyry copper exploration project located in the cordilleran region of San Juan Province, Argentina, near the border with Chile.
During the first 10 years of operations Los Azules was anticipated to be the world's 25th largest copper producer and a lowest cost quartile producer. Los Azules is one of the world's largest undeveloped high‑grade open pit copper projects, which contains significant further growth potential.
- INDICATED RESOURCES
- INFERRED RESOURCES
LOS AZULES
962 Million Tonnes
10.2
BILLION LBS
0.48
COPPER GRADE (%)
INDICATED
55.7
MILLION OZ
1.8
SILVER GRADE (GRAMS/TONNE)
INDICATED
1.7
MILLION OZ
0.06
GOLD GRADE (GRAMS/TONNE)
INDICATED
PRELIMINARY
ECONOMIC
ASSESSMENT
FOR LOS AZULES
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HIGHLIGHTS
OF THE PEA STUDY
$3.00/lb Copper
$1,300/oz Gold
$17/oz Silver
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OTHER PERTINENT DETAILS OF THE PEA
The 2017 PEA is a substantial revision of the previous 2013 PEA and contemplates an enhanced implementation strategy resulting in improved economics while reducing execution risk.
The 2017 PEA envisions an owner-operated mine and conventional concentrator (flotation circuit) producing a copper concentrate for export. A phased implementation approach is employed to optimize initial capital expenditure. Phase 1 implementation will have a daily throughput of 80,000 tonnes per day (tpd), and Phase 2 will deliver a 50% increase in the processing rate to 120,000 tpd.
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PROCESSING
The Los Azules concentrator will produce copper concentrate as a final product. The process design has been modeled on the flowsheet and implementation of the recently constructed and operating Antapaccay (Glencore) copper concentrator located in the high Andes of Peru. Antapaccay shares many key characteristics with Los Azules, such as ore properties and process plant altitudes, making it an obvious choice upon which to model the proposed infrastructure. Some minor design changes, in equipment sizing only, have been incorporated based on operating experience at Antapaccay. The plant has been designed for average daily throughput of 80,000 tpd. The concentrator would be constructed on-site and would employ one comminution circuit consisting of a primary crusher, stockpile feed conveyor, reclaim conveyor, one SAG mill, two pebble crushers and two ball mills. The comminution circuit would be followed by flotation, thickening and filtration circuits, a Tailings Storage Facility and concentrate storage. LOM recovery of copper to concentrate is expected to be 91% at a concentrate grade of 30% Cu.
It is planned to expand the capacity of the plant to 120,000 tpd by Year 5 through the installation of additional comminution and flotation capacity. Gold and silver are recoverable to the copper concentrate. No other metals have been identified that would yield by-product credits, nor that have significant amounts of penalty elements.
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CAPITAL AND OPERATING COSTS
| Capital Cost Estimate | ($ Millions) |
|---|---|
| Mining Equipment | $215 |
| Mine Pre-stripping Cost | $193 |
| Surface Scope (Concentrator, Power Line, Tailings, etc.) | $979 |
| Total Direct Cost | $1,387 |
| Total Indirect Cost | $508 |
| Contingency | $48 |
| Total Initial Capital Cost | $2,363 |
OPERATING COST ESTIMATE
| Mining | 5,404 | 3.63 | 980 | 0.44 |
|---|---|---|---|---|
| Process | 5,774 | 3.88 | 1,047 | 0.47 |
| Transport | 2,587 | 1.74 | 469 | 0.21 |
| G&A | 1,620 | 1.09 | 294 | 0.13 |
| Subtotal OPEX | 15,385 | 10.34 | 2,789 | 1.26 |
| Treatment/Refinery Charges | 2,684 | 1.80 | 487 | 0.22 |
| Au & Ag Credits | (2,449) | (1.65) | (444) | (0.20) |
| Net Costs | 15,621 | 10.50 | 2,831 | 1.28 |
The PEA was prepared by Hatch Ltd., a global multidisciplinary management, engineering and development consultancy known for leadership in mining innovation, under the direction of Donald Brown C. P. Eng with contributions from other industry specialists.
The 2017 PEA is preliminary in nature. The mine plan and economic model include the use of Inferred resources. Inferred resources are conceptual in nature and are considered to be too speculative to be used in an economic analysis except as allowed for by Canadian Securities Administrators' National Instrument 43-101 in PEA studies. There is no guarantee that Inferred resources can be converted to Indicated or Measured resources. Mineral resources that are not mineral reserves do not have demonstrated economic viability. As such, there is no guarantee the project economics described herein will be achieved.
The Los Azules technical information and figures on this page were derived from the news release titled "Copper Shines Brightly for McEwen Mining – Enhanced Economics for Los Azules" released on September 7, 2017. To access the news release click here. To access the October 16, 2017 PEA report click here.
For further updates and information on the Los Azules project, the October 2019 memorandum can be accessed here.
On July 6, 2021 McEwen Mining announced a non-brokered private placement financing of up to 8,000,000 common shares of its wholly-owned subsidiary McEwen Copper Inc. at a subscription price of US$10.00 per common share, for gross proceeds of up to US$80 million. McEwen Copper currently has 17,500,000 common shares outstanding.
Pursuant to this transaction, McEwen Copper will hold a 100% interest in the Los Azules copper project in San Juan, Argentina, and a 100% interest in the Elder Creek exploration property in Nevada, subject to a 1.25% net smelter return (NSR) royalty on both assets payable to McEwen Mining.
McEwen Copper intends to pursue an initial public listing within 12 months from the closing of this Offering. Proceeds from the Offering will be used exclusively by McEwen Copper to advance the Los Azules project to a pre-feasibility study, construction of a new year-round access road to the project, exploration drilling at Los Azules and Elder Creek, environmental permitting and community relations, and general corporate purposes.
For further information on McEwen Copper, the July 2021 presentation can be accessed here.