Canatuan plant production exceeds 700 DMTPD; further expansion underway; targeted to increase capacity to 1,200 DMTPD by yearend
“TVI’s Canatuan project is very much on a roll,” said CEO Clifford M. James. “We have attracted additional engineering and management expertise to help fast-track our planned expansion initiatives. The building of two significant dams by our construction team, under the close supervision of international engineering expertise and our Manager of Environmental Protection, was a tremendous achievement under difficult conditions. The surrounding communities are reaping the benefits of Canatuan employment and infrastructure and we are about to move to another level in our socio-economic program as well, towards long-term, sustainable economic development for members of the Indigenous host community.”
TVI Pacific Inc. (TVI) is pleased to announce that the Phase I mill operations of its affiliate, TVI Resource Development (Phils.) Inc. (“TVIRD”), at Canatuan (Zamboanga Peninsula, Mindanao, Philippines) have reached a production level exceeding 700 Dry Metric Tonnes of gossan ore per day (“DMTPD”). Current expansion/construction is expected to increase throughput capacity to 1,200 DMPTD by year-end. A feasibility study for mining and milling the sulphide ore body is progressing, following receipt of positive metallurgical results from previous tests.
CANATUAN PLANT PRODUCTION EXCEEDS 700 DMTPD; FURTHER EXPANSION UNDER WAY TARGETED TO INCREASE CAPACITY TO 1,200 DMTPD BY YEAR-END. DAILY GOLD AND SILVER PRODUCTION NOW AVERAGING APPROXIMATELY 110 AuEqOz PER DAY.
Canatuan management reports that Canatuan plant production recently exceeded 700 DMTPD and peak production of 785 DMTPD was attained, with the existing 8′ X 9′ ball mill utilized as a SAG mill and crusher installation. A second 9′ X 15′ ball mill and new, larger, primary crusher are now being installed and are expected to be commissioned by early October 2005. Operating the new equipment on a standalone basis is expected to result in throughput capacity of approximately 1,200 DMTPD. Management expects that the existing ball mill will be temporarily idled and returned to service in connection with a planned plant expansion beyond 1,200 DMTPD. In an effort to maximize the additional crushing/grinding capacity, several other expansion projects within the plant have been initiated and are well advanced.
At 700 DMTPD, given current recoveries, approximately 60 ounces of gold (AuOz) and 3,300 ounces of silver (AgOz), or 110 gold equivalent ounces of gold (AuEqOz) are being produced per day. Silver credits are added to form gold equivalent values, as the value contributed by silver is significant. (Commodity prices used in determining gold-equivalent values are USD 450 per ounce of gold and USD 7.00 per ounce of silver.)
NEW TAILINGS CONTAINMENT FACILITIES PERMITTED, CONSTRUCTED AND COMMISSIONED – SUITABLY SIZED FOR EXPANDED PRODUCTION
Stage 1 tailings management facilities have been completed at Canatuan and now allow for further expansion of the project. These facilities are intended to provide long-term tailings disposal control within two fully engineered and environmentally responsive impoundments. The completed structures consist of two dams located on Upper Canatuan Creek, which are identified as the Gossan Dam and the Diversion Dam. Construction commenced in April 2005 and both dams are now ready to support increased production from the mine and the mill. Construction involved a combination of TVI personnel and local contractors. Design services and onsite construction management were provided on a full time basis by an international consulting group that specializes in tailings dam construction. A soil-testing laboratory was also set up on site to provide continuous quality control services for borrow materials and materials placement.
The Stage 1 tailings facility is expected to provide tailings storage through the end of 2005 and allow the mill to increase production as described above. Management expects that Stage 2 construction activities will commence in mid to late November 2005, depending on seasonal rains, and will further increase the storage capacity of the impoundment and accommodate additional gossan ore production. Stage 2 is expected to be completed in March 2006.
A presentation on the construction of the project, including photographs, has been provided for viewing and/or download on this website. Please click here for the presentation.
RE-OPTIMIZATION OF GOSSAN RESOURCE/RESERVES UNDERWAY WHICH IS EXPECTED TO RESULT IN INCREASED RESERVES. IN PARALLEL, FURTHER STUDY HAS BEEN INITIATED TO ESTIMATE ULTIMATE PLANT SIZING BEYOND 1200 DMTPD.
TVIRD recently commenced a revision of its Gossan Feasibility Study to assess the ultimate plant sizing beyond 1,200 DMTPD. The 800 DMTPD mill throughput rate and the 2.11 AuEq break even cut off grade for mineable reserves, established in the November 2004 Gossan Feasibility Study, were based on a number of projected parameters, including: gossan resource, expected capital and operating costs and metal prices. The costs to expand the mine, plant and tailings dam facilities from a 250 DMTPD to an 800 DMTPD operation were originally estimated at US $7.4 million. Actual expenditures to August 31, 2005 totaled approximately US $2.4 million, substantially under budget. Management attributes the lower than anticipated expenditures to the successful procurement and installation of good, used, local equipment and the availability and use of good, competent local engineering and construction services. Metal prices used in the Gossan Feasibility Study were US $375 for gold and US $5.50 for silver. Current metal prices are significantly higher than those that were used in the study. (Measured and indicated gossan resource estimates were 1,173,416 tonnes grading 3.457 gpt Au and 127.9 gpt Ag, using a 2.0 gpt AuEq cut-off grade; 1,392,292 tonnes grading 3.137 gpt Au and 115.5 gpt Ag, using a 1.5 gpt AuEq cut-off grade; or 1,706,998 tonnes grading 2.766 gpt Au and 98.9 gpt Ag, using a 1.0 gpt AuEq cut-off grade). This resource figure did not include a significant volume of “rubbly gossan” (boulders and fragments of gossan which have been eroded off the main body, in a laterite matrix,) which forms a zone peripheral to the in-situ gossan deposit. TVIRD is currently re-evaluating the potential of this zone. (For additional information on the Canatuan Gossan Resource, please refer to the updated, NI 43-101 compliant, Independent Technical Report On The Canatuan Copper-Gold Project, Philippines, dated November 23, 2004, which is filed on Sedar at www.sedar.com.)
TVIRD’s consultant, Norwest Corporation of Calgary, Alberta Canada, is currently re-optimizing the resource/reserve, utilizing actual values for current day costs(based on the actual operating costs of the current mine / mill facility), as well as current metal prices. Anticipated future capital requirements at Canatuan will be estimated, having regard to TVIRD’s experience with Phase I construction and engineering plans for Phase II. Management anticipates that the resulting plant will be much larger than the 800 DMTPD plant assumed in the original feasibility study. The larger processing plant and a lower break even cut off grade are expected to result in an increase in reserves.
SULPHIDE FEASIBILTY STUDY PROGRESSING FOLLOWING RECEIPT OF POSITIVE METALLURGICAL STUDY RESULTS
TVIRD has recently completed metallurgical testwork on bulk copper ??C zinc bearing sulphide samples from Canatuan and management is encouraged with the results of that work. Rougher recoveries for both metals are typically over 99% and the problems related to separating the metals into commercial copper and zinc concentrates have now been resolved with the incorporation of a reverse flotation step into the flowsheet. As a result, TVIRD has recommenced its Sulphide Feasibility Study. It is expected that this study will be completed in early 2006.
For additional information on the Canatuan Mine, please refer to the updated, NI 43-101 compliant, Independent Technical Report On The Canatuan Copper-Gold Project, Philippines, dated November 23, 2004, and the updated Gossan Mining Feasibility Study ??C Canatuan Project, dated November 5, 2004, both of which are filed on Sedar at www.sedar.com. Additional information, including maps and photos of the Canatuan Mine, can also be found on TVI’s website, at www.tvipacific.com and on TVI’s dedicated Canatuan Project website found at www.tvicanatuan.com.
For further information: Contact Rocky Dimaculangan, Director Public Affairs, at tels. (632) 836242 or 43
