Copper Mountain records best quarterly results since start-up

The southern British Columbia mine has increased efficiency and lowered costs

by Peter Caulfield — November 10, 2016

Copper Mountain Mining Corporation's open-pit operation near Princeton, B.C., averaged 173,100 tonnes of material per day during the third quarter of 2016. — Photo courtesy Copper Mountain Mining Corporation

Copper Mountain Mining Corporation recently announced third-quarter 2016 revenues of $72.2 million from the sale of 29.5 million pounds of copper equivalent.

Production included 23.5 million pounds of copper; 8,600 ounces of gold and 75,700 ounces of silver.

“During the third quarter of 2016, Copper Mountain achieved new production records at the mine, with mill throughput averaging 39,980 tonnes per day,” said Jim O’Rourke, Copper Mountain president and CEO, in an announcement.

Compared to the third quarter in 2015, total cash costs for the quarter decreased 16 per cent to US$1.45 per pound of copper sold net of precious metal credits. Mining at the company’s open-pit operation in southern British Columbia near Princeton averaged 173,100 tonnes of material per day during the third quarter, bringing average production for the year to date to 187,200 tonnes of material per day.

“The increased production has produced an increase in capital resources,” said O’Rourke.

At the end of the quarter the company had capital resources of $41 million in the form of $25 million in cash and cash equivalents, $11 million in concentrate sales receivables and $5 million of concentrate inventory waiting at the port to be shipped.

“We will continue to focus on cost control and operational improvements to further strengthen the company’s balance sheet,” said O’Rourke. This quarter has been the company’s best quarter since start-up, said Rod Shier, Copper Mountain’s chief financial officer.

Higher third-quarter revenues in 2016 compared to the same period in 2015 are the result of stronger sales and a higher foreign exchange rate for the United States dollar.

Shier said the company has been working on bringing its costs down and making its operation more efficient.

“The installation of the secondary crusher in 2014 has increased efficiency with the SAG (semi-autogenous grinding) mill by enabling us to deliver smaller product to the mill,” said Shier. “That has meant we’ve been able to produce more concentrate from out feed stock.”

Copper Mountain Mining installed its secondary crusher in 2014, which increases efficiency by delivering smaller product to the mill.

Copper Mountain mines its operation with three big shovels, one of which uses diesel fuel.

“We were able to save five cents per gallon by finding another suppler,” said Shier. “When you consume 33 million litres of diesel fuel per year, that’s a big saving.”

Copper Mountain has also racked up savings by taking advantage of BC Hydro’s power deferral program.

Under the program, companies operating metal and coal mines in B.C. can defer a portion of their BC Hydro electricity payments. The amount that can be deferred is capped at the equivalent of up to 75 per cent of its electricity costs over two years of the program.

Shier said Copper Mountain will also be able to save money by turning its three open-pit mines into one large super-pit.

“Because we’ll be operating in one big pit, instead of three smaller ones, we’ll be more flexible in how we work the pit,” he said. “In that way we’ll be able to further lower our costs.”

In addition to mining, the company has also been exploring for new deposits.

The company completed a 5,000-metre drill program in the third quarter. The purpose of the program was to convert inferred resources into measured and indicated status on the western end of Pit 2.

The company said the program was successful in converting blocks, increasing grade, lowering strip ratio and extending mineralization further to the west.

In addition, the company undertook a helicopter-borne Z-TEM survey over the Fenton project area and a number of other properties that it owns in the region. Results of the survey will help define target areas for further drill testing on the Fenton property.

Previous exploration and preliminary drilling on the property identified large areas of alteration with significant enrichment of gold, silver and zinc. The survey will also help evaluate the exploration potential of Copper Mountain’s other early-stage properties in the region in conjunction with recently completed geochemical programs.

Targets on these properties range from large, bulk-tonnage gold-silver deposits to more compact, higher-grade polymetallic deposits.

Copper Mountain’s secondary crusher

Ore from the mine is put into a primary crusher, which crushes the rock into stones less than 5.5 inches in diameter. Then the stones are transported by conveyor belt to the secondary crusher, where they are reduced in size to less than two inches in diameter. After that, the ore goes to the SAG mill for further crushing and grinding.

The secondary crusher is not just powerful but very, very big – approximately 10 storeys in height.

The lower main frame is the largest single piece of the machine. It weighs a little more than 100 tonnes and is almost six metres in diameter.
It is so large that it could not be handled by the Port of Vancouver. The equipment was shipped from Bucharest, Romania, to the Port of Halifax, where it was put on a train and taken to Kamloops. There it was unloaded from its flat car by cranes and loaded onto a truck that took it to the mine site.