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Mt. Milligan Copper-Gold Deposit
Terrane Metals' key asset is the Mt. Milligan copper-gold deposit 155 km northwest of Prince George in central British Columbia, Canada. Terrane Metals purchased the project in 2006 after the previous owner, Placer Dome Inc., was acquired by Barrick Gold Corporation. From 1984 to 2004, Placer Dome and others had completed 900 drill holes in over 200,000 metres of drilling to define the porphyry-style copper-gold resource. Placer Dome had also completed a pre-feasibility study in 1991, received a mine development certificate in 1993 and was reassessing the project in 2005 before being acquired by Barrick.
Terrane Metals has been rapidly advancing the Mt. Milligan Project towards production since acquiring the property in July 2006. The company has conducted a 60 hole - 18,507 metre drilling program to acquire representative fresh material for metallurgical test work, expand the resource in the DWBX and Southern Star zones, and collect geotechnical information across the MBX, 66, and Southern Star zones. Terrane Metals has also reestablished the environmental baseline studies, completed a NI 43-101 resource estimate, optimized the metallurgical process and mine design, and completed a Feasibility Study.
2006/2007 Highlights
- Reinitiated extensive environmental baseline studies as well as public and First Nations consultation programs
- September 2006-April 2007 - Completed 18,507 metres of large diameter core drilling in 60 holes to produce a metallurgical bulk sample and upgrade the mineral resource
- July 2007 - Finalized bench-scale and pilot plant metallurgical test work programs
- August 2007 - Completed NI 43-101 compliant resource estimate with Measured and Indicated Resources
- September 2007 - Terrane Metals is granted a Section 11 Order from the BC Government setting out the formal scope, procedures and methods for an environmental assessment and review of the Project. A key milestone in the permitting process
- October 2007 - NI 43-101 compliant Preliminary Economic Assessment was completed by Wardrop Engineering Inc as part of an on-going $20 million Feasibility Study
- March 2008 - NI 43-101 compliant Feasibility Study prepared by Wardrop Engineering Inc.
Forecast Project Milestones
- Q2 2008 - Environmental Assessment Application
- Q2 2008 - Order mining equipment requiring long lead times
- Q2 2009 - Receive Environmental Assessment Certificate
- Q2 2009 - Commence Mine Construction
- Q1 2012 - Mine Production
Feasibility Study
In March 2008 Terrane Metals announced a Feasibility Study on the Mt. Milligan project, prepared by Wardrop Engineering Inc., The Feasibility Study Report discusses the scope, design features and economic viability of the Mt. Milligan Project (Project) in north-central British Columbia (BC), Canada. The Project is based on a conventional truck-shovel open pit mine and 60,000 tonnes per day (t/d) copper flotation concentrator to be built over a 30-month period at a capital cost of $917 million. Commercial production is scheduled to commence Q1 2012.
Average annual metal production over a 15.3-year mine life is forecast to be 88 million pounds (lb) copper (Cu) and 217,000 ounces (oz) gold (Au). The mine plan has been designed for extraction of higher grade and gold-rich reserves in the early years. Based on three-year rolling average metal prices of US$2.75/lb Cu, US$600/oz Au, US$11.25/oz silver (Ag) and an exchange rate of 0.89 (US$/C$), copper will account for 64% of the revenue and gold will account for 36%. The Project has a pre-tax Internal Rate of Return (IRR) of 18.1% and a pre tax Net Present Value (NPV) at 8.0% of $606 million with recovery of capital in 3.7 years.
The Feasibility Study Pre-Tax Metal Price Matrix can be viewed here  .
The Project is located in close proximity to existing infrastructure. A skilled work force, railroad headings and low-cost power are all available near the Project site. There are no topographic constraints to mine development and the Project is accessible by road. Off-site infrastructure-related costs account for less than 4.6% of the total capital cost.
The Mt. Milligan copper-gold porphyry deposits contain Proven and Probable reserves of 334 Mt averaging at 0.217% Cu and 0.428 grams per tonne (g/t) Au containing 1.6 billion lb of copper and 4.6 million oz gold. The near-surface and tabular configuration of the reserves make them well-suited to low unit cost open pit development at the life-of-mine (LOM) waste/ore ratio of 0.82/1.
A comprehensive and systematic metallurgical test work program on composite samples representative of the mine development plan determined that, on average, 84.6% of the copper and 72.3% of the gold could be recovered into a clean and marketable copper concentrate grading 27% Cu and 45.4 g/t Au. The process plant will utilize large-scale equipment in a simple and conventional single-line flowsheet.
Innovative design and placement of the Tailing Storage Facility (TSF) will minimize the Project footprint, eliminate conventional waste rock storage facilities and provide effective and safe closure. An Environmental Assessment (EA) will be filed in Q2 2008. Extensive local community and First Nations consultation programs are ongoing.
Terrane Metals April 14, 2008 Mt Milligan Feasibility Study - Technical Report Click here .
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