Amid updating a Feasibility Study for the Santo Domingo Copper-Iron-Gold Project in Chile, Capstone Copper (ASX:CSC) has optimised a mine plan and updated its capital and operating cost estimates.
Capstone Copper, which has a market capitalisation of $8.32 billion, says the updated Feasibility Study outlines a robust copper-iron-gold project with a post-tax net present value of US$1.7 billion ($2.59 billion) and an internal rate of return of 24.1%.
Over the first seven years of the mine plan, Capstone Copper, says production is expected to average 106,000 tonnes of copper and 3.7 million tonnes of iron concentrate at first quartile cash costs of US$0.28 per payable pound of copper produced.
Capstone Copper says over the project’s 19-year mine life, production is expected to average 68,000 tonnes of copper and 3.6 million tonnes of iron concentrate at first quartile cash costs of US$0.33 per payable pound of copper produced.
The project has a total initial capital cost of US$2.3 billion, with a capital intensity of US$21,900 per tonne of annual copper equivalent production over the life of mine (LOM).
The 19 year LOM is supported by a higher reserve estimate of 436 million tonnes at 0.33% copper, 26.5% iron, and 0.05 grams per tonne (g/t) gold. The reserve tonnes has increased 11%, while contained copper has increased 23% since the 2020 Feasibility Study.
Santo Domingo has measured and indicated mineral resources of 547 million tonnes at 0.31% copper and 0.04g/t gold, including 506 million tonnes with an iron grade of 25.8%.
CEO John MacKenzie says the study marks a “major” step towards the creation of a “world-class” district in the Atacama region of Chile.
“The 2024 Feasibility Study significantly enhances the mine’s economics backed by low capital intensity and first quartile costs,” MacKenzie says.
“A construction decision and the integration of Santo Domingo represents the next phase of our transformational growth as we become a leading, long-life, and low-cost producer of critical metals essential for the world’s decarbonisation efforts.
“We now intend to progress with the assessment of the optimal financing structure for the project, which may include bringing in a minority partner at the project level. In parallel, we will also continue to advance the detailed engineering on the project.”
Capstone Copper also plans to progress several value enhancement initiatives within the Mantoverde-Santo Domingo district.
COO Cashel Meagher says the mine plan represents the next step for the company.
“Having recently completed construction at our Mantoverde Development Project, we have an experienced mine-build team which today is rare in our industry,” Meagher says.
“The Feasibility Study for Santo Domingo outlines an actionable investment opportunity with an attractive rate of return and a short payback period. Over time, we plan to further augment these base case numbers with additional opportunities, including unlocking cobalt production in the district, processing Santo Domingo’s oxides at Mantoverde, and continuing to explore the district to improve our understanding of the longer-term potential.”
Capstone Copper is an American-focused copper mining company headquartered in Vancouver, Canada.
Write to Aaliyah Rogan at Mining.com.au
Images: Capstone Copper
