Ivanhoe Australia Ltd , 83 per cent owned by Ivanhoe Mines Ltd of Canada, will develop three new copper mines in eastern Australia over the next five years, Chief Executive Peter Reeve has said.
One of the mines, the second to be developed, could yield 25,000-35,000 tonnes of cathode a year, Mr Reeve told Reuters
The properties covering 2,250 square kilometres in eastern Australia’s Cloncurry region were undergoing studies to gauge the mines’ economic feasibility, Mr Reeve said after the company filed an update on mines’ estimated reserves.
Ivanhoe of Canada is headed by mining magnate Robert Friedland and in partnership with Rio Tinto Ltd/Plc is attempting to exploit Mongolia’s Oyu Tolgoi copper mine in Mongolia, estimated to be one of the world’s largest.
The two companies have been trying to nail down an investment agreement with the Mongolian government amid political squabbling over ownership rights in order to start construction work on the mine, discovered seven years ago. Rio owns 10 per cent of Ivanhoe in Canada.
Mr Reeve said negotiations over access to the three Australian sites already carried mining leases, clearing the way for further exploration work.
One project, Mount Dore, could yield 25,000-35,000 tonnes of cathodes annually by employing heap leaching technology that does not involve smelting at the mine site, Mr Reeve said.
Copper cathodes, or sheets, are traded on the London Metal Exchange and stored in LME-sanctioned warehouses worldwide.
“These are very large resources that show we’ve got a total of 3.1 million tonnes of copper and 5.1 million ounces of gold,” Mr Reeves told Reuters.
Australia last year mined 854,000 tonnes of copper and produced 429,000 tonnes of refined copper, according to the Australian Bureau of Agricultural and Resource Economics.
One of the deposits, named Mount Elliott, holds about 2.3 million tonnes of copper and 4.3 million ounces of gold, while a third, Starra Line holds 274,000 tonnes of copper and 809,000 ounces of gold, Reeves said.
“These are all separate animals but in the same region,” Mr Reeve said.
“The smallest is Starra, then Mount Dore and then the monster, Mount Elliott, and that is probably the order in which they would be developed,” Mr Reeve said.
Development work on all three discoveries would begin within five years, based on the findings of additional exploration, he said.
The mines are located between two established copper mining regions in Queensland state, Cloncurry and Mount Isa.
Swiss-based mining house Xstrata mines hundreds of thousands of tonnes of copper annually in Mount Isa.
Ivanhoe Australia listed on the local bourse on August 6 after raising $125 million ($US101 million) via an initial public offering of 62.5 million shares at $2 each.
Mr Friedland is best known for his discovery of a large nickel deposit at Voisey’s Bay in Newfoundland, Canada, which he sold for $C4.3 billion in 1996 to Inco, now part of Brazil’s Vale .
SOURCE: Business Spectator