Newmont (NYSE: NEM, TSX: NGT) and
Teck Resources (TSX:TCK.A & TCK.B) (NYSE:TCK) are injecting new life into
their NuevaUnión 50-50 joint venture in Chile by investing $152 million into
the project, located in the northern Atacama region.
In an evaluation request filed with Chile’s environmental evaluation service SEA this week, the companies said it planned to conduct the two drilling campaigns this year at the La Fortuna copper-gold deposit, to reduce geological uncertainty.
The first drilling campaign will go
on for about 15 months and is expected to provide geological information for
the characterization of the deposit’s deep levels.
The second campaign, estimated to
last 49 months, should allow the companies to lay the foundations for the
development of a mining plan focused on La Fortuna’s deep levels, the document
says.
NuevaUnión (meaning new union), symbolizes
the merger of two projects the companies had in the region, Relincho and la
Fortuna, which are 40km apart.
It’s expected to provide Newmont and
Teck with a number of key benefits, including reduced environmental
footprint, an optimized mine plan, enhanced community benefits and greater
returns over either standalone project.
Overall, the new mine
will mean lower costs and improved capital efficiency — before
joining Relincho and La Fortuna, the estimated costs for each project were $3.9
billion and $4.5 billion respectively.
With total capex of $7.2 billion
for NuevaUnión’s three phases and an estimated lifespan of 38 years, the mine
is expected to have an annual production of 224,000 tonnes of copper, 269,000
ounces of gold and 1,700 tonnes of molybdenum, according to a pre-feasibility
study from early 2018.
Completion of NuevaUnión’s feasibility study, commenced in the third quarter of 2018, is expected before the end of March.
Earlier this week, Metalla Royalty & Streaming (TSX-V: MTA) acquired a 2% royalty on future gold production from a portion of the La Fortuna deposit and prospective exploration grounds on the NuevaUnión project, said to be one of the world’s largest undeveloped copper-gold-molybdenum proposed mines.