Antofagasta Regulatory News (ANTO)

2 Jul 2007 07:01

Antofagasta PLC02 July 2007 Antofagasta plc ANTOFAGASTA BOARD APPROVES THE ESPERANZA COPPER-GOLD PROJECT London, 2 July 2007 Antofagasta plc ("Antofagasta" or the "Group") announces today that it hasapproved the development of the Esperanza copper-gold project, located in Chile's II Region approximately four kilometres south of the Group's El Tesoro mine.Esperanza is a sulphide deposit which will produce copper concentrate containinggold and silver by-product credits through a conventional milling and flotationprocess. Ore throughput is expected to average 97,000 tonnes per day. Esperanza has a 15 year mine life based on proven, probable and possible orereserves of 535 million tonnes with an average copper grade of 0.55% and anaverage gold grade of 0.23 g/tonne, based on a cut-off grade of 0.2% equivalentcopper. The total measured, indicated and inferred sulphide resource (includingreserves) based on a cut-off grade of 0.2% copper is 1,130 million tonnes withan average copper grade of 0.45%, an average gold grade of 0.16 g/tonne and anaverage molybdenum grade of 0.011%. In addition, there is an oxide ore resourceof 119 million tonnes with an average copper grade of 0.35%, which mainly formspart of the 170 million tonnes of overburden to be removed throughpre-stripping. The Esperanza project is adjacent to Antofagasta's Telegrafosulphide deposit which ultimately is expected to utilise the Esperanza plant andfacilities and extend the mine life well beyond the initial 15 year mine plan. Capital costs are estimated at US$1.5 billion, which includes US$162 million forpumping, pipeline and desalination facilities to enable all the project's waterneeds to be supplied by seawater. First production is expected at the end of2010 and in its first ten years of operation Esperanza is expected to produce anannual average of approximately 700,000 tonnes of concentrate containing 195,000tonnes of payable copper, 229,000 ounces of payable gold and 1,556,000 ounces ofpayable silver. Marcelo Awad, Chief Executive Officer of Antofagasta Minerals S.A., the Group'smining division, commented, "We are very pleased to announce the development ofthe Esperanza project. This is an important step in the Group's growth strategy,and when in full production Esperanza is expected to increase overall copperoutput by over 40% from current levels. Esperanza is a competitive andenvironmentally sound project located in Chile, the world's largest copperproducing country, where the Group has successfully developed its three existingoperations." The project and its timing are subject to relevant environmental approvals. Enquiries London Santiago Investor relations - Antofagasta plc Antofagasta Minerals S.A.Tel: +44 20 7808 0988 Tel: +562 377 5000www.antofagasta.co.uk Francisco Veloso Desmond O'Conor - doconor@antofagasta.co.uk Email: fveloso@aminerals.clHussein Barma - hbarma@antofagasta.co.uk Media enquiries - Bankside ConsultantsTel: +44 20 7367 8873 Keith Irons - keith@bankside.comOliver Winters - oliver.winters@bankside.com This information is provided by RNS The company news service from the London Stock Exchange