AS IT nears the completion of the first phase of its rehabilitation, a mine in Toledo City expects to begin ore production next month.
As of the end of May, the rehabilitation of the former Atlas mine, now being operated by the Carmen Copper Corp. (CCC), was 92 percent completed, said CCC vice-president and resident manager Rodrigo Cal.
“We are on time with the (rehabilitation) schedule,” he added during a mine tour yesterday participated in by various nongovernment organizations (NGOs) and concerned government agencies.
The Department of Environment and Natural Resources (DENR) 7, through the Mines and Geosciences Bureau (MGB) 7, organized the mine tour as part of the Environment Month celebration.
With the completion of the 10-month phase one rehabilitation, CCC expects to produce 20,000 metric tons of copper per day
from the South Lutopan pit.
Waste
The South Lutopan pit covers an area of about 50 hectares with a current depth of 195 meters.
At present, waste stripping is already being done in the area that is expected to contain nine million tons of copper deposits.
The mine is expected to generate about 50,000 tons of waste a day. Waste, in mining terms, would mean the stones that do not contain any ore.
But as CCC starts the second phase of rehabilitation—which will last for one year—after the completion of the first phase, it will have to tackle the challenge of raising additional funds to cover the cost of the endeavor.
Cal said to fully rehabilitate the mine, the company would need a total of $248 million.
CCC was able to get a $100 million loan from the Deutsch Bank while Singaporean company Crescent Asian Special Opportunities Portfolio put up an additional $33 million in capitalization.
Off-take agreements
CCC, said Cal, has already entered into off-take agreements with three smelters that are also prospective buyers of the copper produced from the mine. Through an off-take agreement, the buyers are requested to advance the money to CCC, Cal explained.
“We (need) to raise the money before the end of July,” he said.
Cal, however, refused to disclose the names of the smelting companies.
But because of the huge investment incurred to start mine production, Cal said the company would still have a negative income from copper sales until the middle of 2009.
The company expects, however, to start earning by the last quarter of next year should the current rate of copper remains the same by then.
At present, copper is priced at $3.70 per pound. Before the mine temporarily closed 14 years ago, copper was priced between US 65 cents to US 70 cents.
Cal said, though, that with the increase in oil prices, it is now “costlier” to produce ore compared to the time before the mine closed.
The Atlas mine was closed more than 12 years ago.
Cal also said that with the investment to re-open the mine, it usually takes 40 months to get a return.
By August, the company is expecting to ship out and sell 2,700 pounds of copper.
Aside from copper, CCC is also expecting to produce gold, silver, pyrite and magnetite.
Pyrite concentrates are used as fertilizers while magnetite is a raw material for the steel industry. (DME)
