$US129 million expansion at Cobar mine

The Glencore-owned Cobar copper mine could see a huge boost to production, with a $US129 million expansion.

The Swiss mining and trading giant said in a report released last week that it is finalising a feasibility study to extend its mine shaft to allow lower-cost access to deeper resources from the beginning of 2013.

"The shaft will have the potential to allow an increase in annual production by approximately 90,000 tonnes (of copper concentrate)," the report said.

"In addition, Cobar has entered into two joint ventures to explore tenements in the area."

The mine, in central New South Wales, produces about 180 000 tonnes of copper concentrate and employs 260 workers.

The company has not revealed what grade the resource is, but the Wall Street Journal estimates that based on reserve and resource estimates, the grade concentrate is about 30 per cent.

Glencore says it is always looking to use its expertise abroad to expand its business.

"Glencore believes that its geographic scope in countries and markets in which some of its competitors have historically avoided, or been slower to enter, has and will continue to provide an effective first-mover advantage in a number of geographies with high-quality strategic resources, such as the CIS, parts of South America, the African Copperbelt and Australia,” it said.

The Cobar mine, which is wholly owned by the Swiss company, has a five-year life based on reserves and an 11-year life based on resources.

Glencore also owns a 40 per cent stake in the Murrin Murrin nickel laterite mine in Western Australia directly and a 70.5 per cent in Minara Resources that owns 60 per cent of Murrin Murrin.
 

Image: Glencore International