Study say Ajax mine a feasible project
It has yet to receive approval from senior levels of government, but the proposed Ajax mine south of Aberdeen has cleared a major hurdle.
The results of a feasibility study show there is an economic case to develop the mine.
According to the results of the study, which was released by Abacus Mining and Exploration on Wednesday, Dec. 21, under recent mineral prices, the value of the mine could quadruple to $1.6 billion from the initial $416 million.
In a statement, Abacus CEO and president Jim Excell noted the feasibility study confirms the economic viability of the mine at long-term copper and gold prices.
The study also noted that, under optimum conditions, Ajax would pay back its initial capital in just over two years.
The initial capital cost to start the mine is projected to be $795 million, including a contingency of $87 million.
“The Ajax Mine economics compare very favourably to the leading copper projects being developed around the world, given its long life, location, open-pit mining and conventional processing,” Excell said.
The mine is expected to produce 2.5-billion pounds of copper and 2.7-million ounces of gold over its 23-year life span.
The feasibility study was conducted in May 2010.
According to the London Metal Exchange, in the last three years, copper has been trading for as low as a $1 per pound to a high of more than $4.50 per pound last year.
The metal is currently listed at $3.29 a pound.
The release of the statements noted a number of factors could alter the results, from changes to commodity prices to the mining company’s ability to get required permits, including permission from Kinder Morgan to gain access to a pipeline right-of-way.
The feasibility study is likely to be a topic of discussion at upcoming public-consultation meetings.
Federal and provincial environmental-assessment agencies will hold a public comment period from Jan. 11 to March 12, including a two-day public-information session on Feb. 6 and Feb. 7 at the Coast Kamloops Hotel and Conference Centre on Rogers Way.
Located partially within City of Kamloops boundaries and two kilometres from a pair of Aberdeen elementary schools, the Ajax mine operation would stretch west to the Coquihalla Highway and is part of the old Afton Mine site.