Photo by: Reuters
TORONTO (miningweekly.com) – TSX- and LSE-listed EMED Mining’s endeavours to restart mining from the historic Rio Tinto copper mine, in Spain’s region of Andalucia, this week took another critical step in the process of obtaining the required environmental permits to start production.
On Thursday, the director-general of industry, energy and mines of the Junta de Andalucia, Maria Jose Asensio, along with the Economy, Innovation, Science and Jobs Minister Jose Sanchez Maldonado, announced that the government of Andalucia had issued a ‘compatibility report’ regarding the reopening of the Rio Tinto mine, in the Huelva province, stating that there were no inconsistencies in any environmental aspects of the project.
The compatibility report is an internal report between the department of Environment and the Ministry of Economy, Innovation, Science and Jobs, by which the Environment Department had provided the competent body – the Department of Industry, Energy and Mines – with confirmation that there were no inconsistencies.
“The company has been assured that everyone is working intensively on the environmental dictamen [Spanish for opinion] and it will be issued as soon as possible. The fact that this statement has been made with the agreement of both departments is an extremely significant step as they are both publicly acknowledging that the project is workable from an environmental perspective,” EMED interim MD and CEO Rod Halliday said.
EMED’s project, which gave birth to mining giant Rio Tinto, is located in the Iberian pyrite belt, 65 km north-west of Seville, Spain. The openpit mine and processing facility had been on care and maintenance since mining ceased in 2000, owing to low copper prices at the time of less than $1/lb.
EMED was granted an option to acquire the operation in May 2007, and it was subsequently acquired in October 2008.
Also located just 20 km from Seville, base-metals miner Inmet Mining has for the last three years been operating the Las Cruces copper mine, host to some of the mining industry’s highest grades, which has been a huge boon to Inmet.
The Rio Tinto project was also located about 75 km from Freeport McMoRan’s Atlantic copper smelter and a major seaport.
A National Instrument 43-101-compliant technical report completed by Behre Dolbear in November 2010, had placed a base-case net present value of $654-million on the project, using a price of $3.50/lb copper.
The project had total expected cash costs of about $1.57/lb, including all operating, capital and acquisition expenses.
The Rio Tinto mine currently had proven and probable ore reserves totalling 123-million tonnes at 0.49% copper for about 610 000 t of contained copper, at a cutoff grade of 0.2% and measured and indicated mineral resources of 203.1-million tonnes at 0.46% copper, for about 930 000 t of contained copper at a cutoff grade of 0.2%.
The project has ample opportunity to extend the current expected 14-year mine life by converting more resources to reserves, and had potential for higher grades once operations started targeting underground reserves later in the mine plan.
Friday's permitting news pushed the company's TSX-listed stock up to a high of C$0.19 apiece.