Copper Mountain Mining Corporation has approved the beginning of development at the Eva copper project in Queensland with commissioning planned for 2024.
The Canadian miner completed a feasibility study in the first half of 2020 and has now decided that its economics have improved enough to warrant some action.
The study found a combined proven and probable mineral reserve of about 780,000 tonnes of copper and 260,000 ounces of gold for an expected mine life of 15 years.
Copper Mountain president and chief executive officer Gil Clausen said increased metals prices had been a driving factor in the economic feasibility of the project, while inflated development costs were expected to settle toward 2024.
“The current inflationary environment prevalent globally, particularly for some material and labour supply in Queensland Australia, has resulted in some project capital cost escalation,” Clausen said.
“We believe this impact will ease as the local economy opens fully after COVID-19 restrictions lift, materials flow regularly and labour pressures relax over the next six to 12 months.”
While the plan to construct the project has been approved, several conditions were stated by Clausen. These included 80 per cent completion of advanced engineering plans; securing project financing; and the lifting of COVID-19 restrictions in Queensland.
“Upon satisfaction of these items, the company will be able to fix a construction start date,” Clausen said.
“We expect this detailed engineering work to require approximately six months to complete during which time the company will secure commitments on certain critical long lead-time equipment.”
Since the feasibility study was complete, capital costs to develop Eva have risen by 18.7 per cent to $836 million.
“Cost increases in steel, mechanical, concrete and construction labour were the most significant drivers in the higher capital costs, particularly in the processing area,” the company stated.
“Raw material and finished equipment costs have been impacted by shortages as COVID restrictions remain tight, especially in Queensland.”
Financing is expected to be secured by mid-2022, according to Clausen who said he looked forward to developing another important source of copper for an increasingly electrified society.
“We are excited to formally advance Eva, which is expected to add over 100 million pounds of copper production per year, given the ever increasing and important role copper will play in a green economy and the limited number of other copper projects currently in development globally,” Clausen said.
Eva is located 95 kilometres north east of Mt Isa in north west Queensland.