McEwen Copper, a subsidiary of McEwen Mining Inc. (NYSE: MUX) (TSX: MUX), reported more significant copper values over wide intercepts from recent drilling at the Los Azules project in San Juan, Argentina.
The company announced the results on Wednesday, which most notably yielded an intercept of 0.75 per cent copper over 398 metres including 1.43 per cent Cu throughout 124 metres in Hole AZ23220.
McEwen’s latest drill program that yielded the new results began in October and concluded on June 19. It consisted of 15 rigs completing 39,000 metres of drilling in 138 holes and the average grade the company intercepted was 9 per cent higher than anticipated at 0.567 per cent Cu.
Preparations are currently underway for the next phase of drilling at Los Azules, which is expected to begin this fall. Additional results from recent drilling include the following:
- Hole AZ23218: 202 metres grading 0.63 per cent Cu within 239.2 metres with 0.59 per cent Cu
- Hole AZ23216: 338 metres grading at 0.58 per cent Cu
- Hole AZ23206: 353 metres with 0.46 per cent Cu including 190 metres grading at 0.57 per cent Cu
Los Azules – Latest Assay Results – 398m of 0.75%Cu , including 124m of 1.43%Cu
Following the updated a PEA, @McEwenCopper completed 24 infill drill holes with 0.567% Cu avg grade, aligning well to the 0.520% Cu resource model prediction. #copper $MUXhttps://t.co/vkzLuihjtR pic.twitter.com/8eF6u2ZM4E— McEwen Mining (@McEwenMining) July 12, 2023
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Depth and lateral extent of the project remains unknown as drilling continues
McEwen completed an updated preliminary economic assessment (PEA) for Los Azules last month, which indicated that the site contained 10.9 billion pounds of indicated copper and would produce 401 million pounds of the metal annually for the first five years of its 27-year lifespan. Following that period the project is expected to produce 322 million pounds of copper per annum.
It is expected to generate average earnings before interest, taxes, depreciation and amortization (EBITDA) of US$1.1 billion annually during the first five years as well.
The project’s after-tax net present value is estimated to be US$2.7 billion and Los Azules has attracted investments from major automotive and mining companies like Stellantis (NYSE: STLA) (Euronext Milan: STLAM) (Euronext Paris: STLAP) and Rio Tinto Ltd. (ASX: RIO) (LON: RIO).
Diagram showing the recent intercepts. Photo via McEwen Mining
McEwen Copper plans on achieving carbon neutrality at Los Azules by 2038 and has decided to use a heap leach method at the project going forward rather than the previous plan to build a mine with a traditional mill and flotation concentrator to create concentrates for export.
The company is doing this primarily to help protect the environment as the new method uses 75 per cent less water and electricity.
The rate of mining exploration in Argentina last year was the highest it had been since 2012 with approximately US$370 million invested in mining ventures throughout the country. Copper accounts for more than 50 per cent of the country’s US$27 billion portfolio of mining projects.
Argentina’s Mining Secretariat Fernanda Avila said earlier this month that mining exports from the country were expected to increase by over 100 per cent in the next two years to an approximate value of US$8.6 billion.
Other copper producers in the country include Aldebaran Resources Inc. (TSX-V: ALDE) (OTCQX: ADBRF), operator of the Altar copper-gold project in San Juan and Rio Grande copper-gold operation in northwest Argentina; Vancouver’s Filo Corp. (TSX: FIL) (Nasdaq First North Growth Market: FIL) (OTCQX: FLMMF), which focuses on its flagship Filo del Sol copper-gold-silver deposit in San Juan; and Glencore PLC (LON: GLEN), which runs the El Pachón copper and molybdenum project in San Juan.
McEwen Mining stock rose by 9.47 per cent Wednesday to $10.52 on the Toronto Stock Exchange.
rowan@mugglehead.com
