BRITISH COLUMBIA – The preliminary economic assessment of the Mount Milligan copper-gold project 155 km northwest of Prince George looks promising for owner TERRANE METALS of Vancouver. At prices of merely US$550/oz for gold and US$2.50/lb for copper, the $827-million project would pay for itself in less than four years. That represents a pre-tax internal rate of return of 20.6%.
The Mount Milligan deposit was discovered in 1987. Placer Dome conducted over 200,000 metres of drilling and completed a pre-feasibility study on the property before the company was taken over by BARRICK GOLD last year. Terrane’s latest estimate puts measured and indicated resources at 417.1 million tonnes grading 0.21% Cu and 0.41 g/t Au, or 1.9 billion lb of copper and 5.5 million oz of gold. There is also a small inferred resource.
The minable resource (proven and probable) is 317.0 million tonnes that can be recovered by open pit methods with a stripping ratio of 0.74:1. Head grades for a 60,000-t/d concentrator are expected to be 0.2% Cu and 0.43 g/t Au. A concentrate grading 27.6% Cu and 54.0 g/t Au will be produced. Mine life is estimated to be 14.5 years.
WARDROP ENGINEERING, which was responsible for the preliminary assessment, recommends that Terrane continue work and produce a feasibility study. If a feasibility study were completed in Q1 2008 and permitting complete in Q2 2009, commercial production could begin in Q2 2011.
Additional details of the preliminary study are available at www.TerraneMetals.com.