30th Jul 2014 11:38
LONDON (Alliance News) - Herencia Resources PLC Wednesday said geological work and 3D modelling at its Picachos copper project in Chile have confirmed outcropping and shallow copper mineralisation ideal for bringing into production a low-cost open pit mine.
The Chile-focused mineral exploration and development company said the geological work and modelling of its 40 metre shaft zone, the main zone on site, followed recent positive results from drilling at the site.
Earlier in July, the company said the most recent results from drilling include an 18 metre space at 1.33% copper and 6.1 grams per tonne of silver from 60 metres in depth at its PP14020 hole, and a 20 metre space at 0.89% copper and 8.3 grams per tonne of silver from 62 metres in depth at its PP14028 hole.
The company said at the time that the 3,540 metre programme had shown high-grade copper results throughout the area with enough silver grades to offer a significant boost to its potential revenue stream.
On Wednesday, the company said it has also identified key targets for potential future resource expansion adjacent to, at depth, and to the east of the main zone at Picachos.
Herencia said that given the significance of the results, it has started negotiations with the owners of a number of local processing plants in relation to toll-treatment opportunities for Picachos.
The company said that some of the local processing plants are underutilised, and it has indicated a potential supply target of up to one million tonnes per year from the site. Subject to further work and the results of an ongoing economic assessment, Herencia hopes to start processing in 12 to 18 months.
Herencia said that outsourcing toll treatment would mean it would not be required to construct its own processing plant, saving significant time and capital costs.
The company said it also has started discussions with contract mining and haulage companies to obtain costs for potential open-pit mining at the site and its transport to treatment.
"Once our Picachos resource has been established and the project economics evaluated, we see it as a straightforward process of commencing low-cost open-pit mining targeting the outcropping and shallow high-grade copper mineralisation," Managing Director Graeme Sloan said in a statement.
Herencia Resources shares were up 10% to 0.484 pence, putting it amongst the top ten AIM risers on Wednesday.
By Tom McIvor; [email protected]; @TomMcIvor1
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