North America-focused Phoenix Copper has completed a new economic model for the Idaho-based Empire mine, which the company will now use as a basis for the feasibility study that it aims to deliver before the middle of next year.

The economic model, which was prepared by Hard Rock Consulting of Lakewood, Colorado, is based on ore production of 1.6-million tons a year over an initial nine-year mine life, with a further two years of low-grade ore processing at the end of mining.

This model does not take into account recovery of gold and silver, but does include zinc recovery.

Based on the economic model, Empire will produce an average of 7 665 t/y of copper equivalent, including 7 000 t/y of copper and 1 600 t/y of zinc, over its mine life, at a copper-equivalent cash cost of $1.72/lb.

“The production schedule uses two copper cutoff grades to ensure higher grade ore is fed to the heap leach pad first,” CEO Dennis Thomas explained last week.

The increase in the initial pad grade allowed the mine production rate to be reduced from 2.25-million tons a year in the April 2018 economic model to 1.6-million tons, resulting in a reduction in the preproduction capital cost from $68-million to $51-million.

“We believe the copper price will improve in the medium term, which is the largest sensitivity in this project, given that with each $0.25 increase in the copper price, a further $15-million of value is added to the project,” he added.

At a copper price of $2.75/lb, the Empire mine has an aftertax net present value (NPV), at a 7% discount, of $25.5-million and an internal rate of return (IRR) of 20%. When the copper price rises to $3.25/lb, the NPV increases to $55.5-million and the IRR to 33%.

Phoenix, which is listed on the Aim in London, would look at expanding and extending the project in future. It would also continue to evaluate the wider Empire district, which comprised 23 km² of mineralised claims staked along a 5.4 km strike length from the Empire oxides, as well as the Navarre Creek precious metals zone.